The Central Bank (CBE) kept its key interest rates unchanged on Thursday at a meeting of its monetary policy committee, it said in a statement, after it had raised them by a total of 400 bps in the previous two meetings. It kept the overnight deposit rate at 18.75% and the overnight lending rate at 19.75% on Thursday. The CBE has raised key interest rates by a total of 700 bps since it floated the pound in November. The decision to maintain policy rates comes in line with our expectations, given that the CBE had raised them by a total of 400bps in the past two meetings, partially pre-empting the elevated inflation reading for July. Monetary data for June also showed money supply growth was largely stable and so was private sector credit growth. We stay of the view that the tightening cycle has likely come to an end, but we remain a few months away from any potential easing in policy rates.  

Mohamed Abou Basha