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The central bank of Egypt raised interest rates by 600bps during an unscheduled meeting on March 6th 2024, pushing the key overnight deposit rate to a record high of 27.25% and the overnight lending rate to 28.25%, also an all-time high. The decision, which follows a 200bps hike back in February, aims to accelerate the monetary tightening process in order to fast-track the disinflation path and ensure a decline in underlying inflation. The central bank also noted that the latest tightening brings the monetary stance to a sufficiently restrictive level, to anchor inflation expectations, and will be maintained for as long as necessary to achieve the desired disinflation course. Inflation in Egypt remains elevated at 29.8% and the central bank expects it to remain well above the 7% target this year. Also, the Egyptian economy has been recently hit by foreign exchange shortages resulting in the existence of a parallel exchange rate market and constraining economic growth.