The asset-liability committees (ALCO) at banks, responsible for determining interest rates, are set to begin discussing the repercussions of the decision by the Central Bank of Egypt (CBE) to raise its basic interest rates by 2% on Thursday. Negm also expected the purchasing power of the pound to increase after raising interest rates and boosting inflows into the Egyptian banking system. Meanwhile, one of the private banks confirmed that the other banks operating in the Egyptian market are looking forward to the decision of NBE and Banque Misr, as well as the interest rates on government debt instruments before making any decision on their interest rates. Banks had ignored a similar decision taken by the CBE on 21 May 2017 to raise basic interest rates by 2%. Only a limited number of banks moved their interest rates up on their deposits, saving accounts, and saving certificates, which were linked to the CBE’s rates.

Source: Daily News Egypt July 08, 2017 12:11 UTC