Egyptian economist Mostafa Badra told RT about the consequences of the decision of the Central Bank of Egypt to fix the interest rate at a time when a number of banks around the world announced their increase.
The Egyptian expert said in statements to RT that with the beginning of 2023 and the first meeting of the monetary policy committee under the Central Bank of Egypt, interest rates were fixed, and of course this was done after a thorough study by the Central Bank and monetary policy on interest rates and inflation rates.
Badra pointed out that before this decision, interest rates increased by 3% in 2022, but the Policy Committee decided to fix them in the new year, and against this background, exchange rate flexibility arises, and that there is a variable in the exchange rate that is more flexible within the banking system, and that it has become an engine. The main one is inside, and the black market has almost disappeared.
He explained that the Central Bank of Egypt, prior to the announcement of the Monetary Policy Committee, spoke of a significant improvement in the performance of foreign exchange receipts, whether from tourism or the Suez Canal, as well as from exports, and the Central Bank is credited with improving the government’s foreign exchange and trade resources. balance sheet, and this case was met with the approval of many investors, and their entry into investments in bonds and treasury bills or so-called hot money, as well as their entry into the securities of the Egyptian Stock Exchange.
He pointed out that given the reversed or reflected conditions in the world, when the US Federal Reserve raises interest rates by 25 basis points, which is called an audit policy, this indicates the beginning of signs or clarity of vision that inflation in the world may be declining during 2023, and of course, a twenty-five basis point increase in the interest rate of the US Federal Reserve, followed by many central banks in the Gulf region or the European Union, or the so-called European Central Bank, rising twenty-five basis points, and it shows that there are high hopes that by 2023 it will be possible to curb inflation, which is the basis for preventing a recession in the global economy.
Cairo – Nasser Hatem
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