Egypt central bank keeps key rates on hold

The Egyptian central bank kept its key overnight interest rates unchanged on Thursday, saying inflation remained within its comfort zone and economic activity was improving. The decision, in line with forecasts, marked the third pause since the bank began a series of rate cuts 12 months ago. All nine economists polled by Reuters had expected the bank to keep rates stable. The overnight lending rate was left at 9.75 per cent and the deposit rate stayed at 8.25 per cent, the central bank said on its website. The discount rate was also steady at 8.5 per cent. "Annual core inflation inched up to 6.85 per cent in December compared to 6.59 per cent in November on the back of the unfavourable base effects from last year and remains within our comfort zone," the bank said in a statement accompanying its decision. Core inflation strips out subsidised goods and volatile items. The urban consumer price index fell 1.3 per cent month on month in December, though year-on-year inflation in December was steady from November at 13.2 per cent.