Egypt raised interest rates to curb inflation: CBE Governor Abdullah

Abdullah added that raising the interest rates aims to curb the increase in the prices of goods and services and support foreign investment.

The CBE reiterated its commitment to maintaining price stability in the medium term.

Abdullah stated that the CBE will continue efforts to target inflation as the nominal anchor of monetary policy while allowing the exchange rate to be determined according to market mechanisms.

Unifying the exchange rate is a crucial measure as it helps eliminate the accumulation of demand for foreign currency following the closure of the gap between the official and parallel market exchange rates, he said.

Abdullah added that inflation in Egypt has been put on a downward trajectory to achieve the targeted rates.

On Wednesday, the Monetary Policy Committee decided in its extraordinary meeting to raise the deposit and lending rates for overnight and the main operation rate of the Central Bank by 600 basis points to reach 27.25 percent, 28.25 percent, and 27.75 percent, respectively.

Credit and discount rates were raised by 600 basis points to reach 27.75 percent.

As a result of this decision, the Egyptian pound experienced a significant drop on Wednesday, declining by 62 percent to approximately EGP 50.1 against the US dollar and EGP 54.5 against the euro.