Thursday, May 09,
Books by Mustafa Eid:
The investment bank Faros and Shuaa expected the central bank to keep interest rates unchanged at the next meeting of the bank's monetary policy committee on Thursday [May 23rd].
"We expect interest rates to remain stable until the fourth quarter of 2019, which we expect to see a reduction of between 100 and 200 basis points," the investment bank Pharos said in a report on Thursday.
"The current and expected inflation patterns do not support any interest rate cuts soon," Shuaa Investment Bank said, adding that the Ramadan and Eid holidays are likely to continue inflationary pressures.
"We believe the central bank may prefer to keep interest rates unchanged until the end of the year and can consider a rate cut by November or December if the important picture is supportive," Shuaa said in a report today.
The central bank had set interest rates at the second meeting of the Monetary Policy Committee this year on March 28, at 15.75% for the deposit and 16.75% for lending, after having reduced it by 1% on February 14.
The expectations of the investment banks to stabilize interest rates, despite the announcement by the Central Agency for Public Mobilization and Statistics, on Thursday, the decline in inflation for the second month in a row in April.
The annual inflation rate of the republic declined to 12.5% in April from 13.8% in March, according to the Census Bureau. The monthly inflation rate fell to 0.4% in April from 0.9% in March.
It is expected to raise fuel prices in less than 40 days from now, as the government is committed to access the prices of petroleum products to the level of cost before mid-June, to apply the mechanism of automatic pricing of these products to avoid the impact of global price movements of oil on the support of petroleum materials in the budget.