HC Securities and Investment HC Securities & Investment expects the Central Bank of Egypt Central Bank of Egypt to keep interest rates unchanged at the upcoming Monetary Policy Committee meeting scheduled for May 21, 2026, amid ongoing domestic economic developments and regional geopolitical tensions
Heba Monir, Financials Analyst and Economist at HC, said that Egypt’s flexible exchange rate and improved external position helped absorb part of the impact of the US-Israeli war against Iran, despite foreign outflows from Egypt’s treasury market totaling around $3.2 billion between late February and the end of April
She added that Egypt’s net international reserves rose to a record $53 billion by the end of April, while banks’ net foreign assets declined to $21.3 billion by the end of March due to foreign investor exits from local debt instruments
Monir also noted that recent increases in domestic fuel and natural gas prices, alongside higher global oil, gas, and wheat prices, are expected to fuel inflationary pressures in the coming period
She pointed out that several public banks raised rates on newly issued three-year certificates of deposit to an average of 17.25%, followed by similar offerings from private banks, describing the move as an indirect monetary tightening measure aimed at containing inflation and supporting the Egyptian pound
According to HC, maintaining the attractiveness of Egypt’s carry trade remains a key factor supporting the decision to keep rates unchanged, especially with 12-month treasury bill yields reaching 24.4%
At its previous meeting on April 2, the Central Bank of Egypt kept overnight deposit and lending rates unchanged at 20% and 21%, respectively, while reducing the required reserve ratio for banks to 16%
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