Egypt’s headline inflation rate climbed to a near three-year high of 8.8% y/y in February and it will continue to increase over the coming months on the back of soaring global food and energy prices, as well as the forthcoming reduction of bread subsidies. Against this backdrop we think that the central bank (CBE) will now hike interest rates by 50bp, to 8.75%, at its MPC meeting later this month.
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