Decrease in the interest rates is expected to affect positively the mortgage market

The Monetary Policy Committee of the Central Bank of Egypt (CBE) cut the overnight deposit rate, the overnight lending rate, and the rate of the main operation for the third consecutive meeting in row by 1 percent or 100 basis points during Thursday's meeting, Nov. 14, matching analyst expectations. The overnight deposit rate, the overnight lending rate, and the rate of the main operation are cut to be at 12.25 percent, 13.25 percent, and 12.75 percent, respectively. Moreover, credit and discount rates were reduced to 12.75 percent from 13.75 percent.

 

AAIMF pointed that the recent decision contributes directly to improving the mortgage finance market in Egypt, and encourages investors and individuals to obtain mortgage finance.  

 

The Central Bank of Egypt was compelled to raise the interest rate after the liberalization of the exchange rate in November 2016, about 3 times by 7%, the first time after liberalization directly by 3%, and 2% last May, and 2% in July, then in February and March interest was reduced is 1%, each month.

 

Now the total decrease in interest rate has reached around 3.5% since the beginning of 2019, and about 5.5% since 2018. 

 

November, 2019