CBE pulls record EGP 1 trillion to curb inflation

The Central Bank of Egypt (CBE) pulled EGP 1 trillion in liquidity from local banks, which is the largest such withdrawal in the bank's history. The interest rate offered during the CBE's weekly fixed-rate auction was set at 27.75 percent, as stated on the bank's official website.

 

This liquidity withdrawal is part of the CBE's open market operations to effectively regulate the money supply within the Egyptian banking system. 

 

The purpose of these deposit auctions is to help curb the country's high inflation rate.

 

In April 2024, Egypt's annual headline inflation had dropped to 31.8 percent, down from 33.1 percent the previous month, according to data from the Central Agency for Public Mobilization and Statistics (CAPMAS). 

 

The overall monthly inflation rate for April 2024 was 0.9 percent, compared to 1.0 percent in March 2024.

 

Notably, food and beverage prices in Egypt decreased by 0.9 percent on a monthly basis in April 2024, though they still increased by 37.6 percent on an annual basis.