Egypt's central bank cuts rates by 150 bps after inflation slows

Egypt’s central bank on Thursday cut the overnight deposit rate by 150 basis points to 14.25%, its first cut since February, after July inflation figures came in significantly below expectations.

The overnight lending rate was cut by 150 basis points to 15.25%, the bank said in a statement after a meeting of its monetary policy committee (MPC).

Seven out of 13 economists polled by Reuters had forecast the bank would cut overnight rates by 100 bps. Three had predicted a 150 bps cut.

The move came after headline inflation slowed to 8.7% in July from 9.4% in June, surprising analysts who had expected inflationary pressures to rise in the wake of a round of subsidy cuts that pushed fuel prices 16-30% higher.