The Central Bank of Egypt’s (CBE) continues to support macroeconomic stability over the medium term, keeping policy rates unchanged and remaining consistent with achieving the CBE’s inflation target of 7% (±2%) on average during the fourth quarter (4Q) of 2022.
The Monetary Policy Committee (MPC) has decided to maintain its main policy rate unchanged in 2021 to date. This comes after the MPC cut key policy rates by a total of 400 bps in 2020 to support economic activity in light of the global and domestic developments stemming from the COVID-19 pandemic.
Global economic activity continues to recover from the COVID-19 pandemic, although growth remains uneven across regions, as some countries are yet to contain the spread of the virus. Prospects for global economic recovery remain contingent on the scale of distribution, as well as the efficacy of vaccines.
Meanwhile, global financial conditions continued to remain accommodative and supportive of economic activity over the medium term, as part of wide-spread efforts to boost the global economy.
Over the medium term, Egypt’s GDP growth is forecasted to follow a better than previously expected recovery trajectory, assuming a continued ease in the degree of uncertainty surrounding the pandemic and its impact on economic activity.
