Increased revenues THE MINISTRY of Planning and International Cooperation released a report which stated that Egypt revenues increased by 19 per cent during the first quarter of the current fiscal year to reach LE43 billion, outpacing the increase in expenditures through the same period which came at 15 per cent. "The increase in revenues failed to tighten the deficit because the latter is huge to the extent that it cannot be contained by the difference in growth rates between both revenues and expenditures," said Monet Dos, macro economy analyst in Prime Securities. The ministry's figures also show that the value of grants Egypt got during the first quarter of the fiscal year 2011/2012 recorded a whopping 74.85 per cent compared to the same quarter of the previous year to reach LE2.3 billion. "The leap is due to the fact that in the corresponding period of the previous year, Egypt only got LE39 million in grants," explained Dos. "We were not in dire need for grants or loans back then. The situation since the revolution and the accompanying economic setback is different as Egypt has been seeking foreign assistance since early May," Dos added. CBE keeps interest rates unchanged THE CENTRAL Bank of Egypt (CBE) kept the interest rates unchanged during its meeting last Thursday. The overnight deposit and lending rates remained unchanged at 9.25 and 10.25 per cent respectively. The move came to the contrary of analysts' expectations of the CBE raising the rates amid continued depreciation of the local currency against the dollar, declining foreign reserves, and strengthening dollarisation rate all of which could have directed the CBE to raise interest rates to support the local currency. However, concerns about the effect of such change on inflation and growth opportunities pushed the CBE to favour keeping the rate on hold. Headline inflation crept up to 9.5 per cent in December from October's four-year low of 7.1 per cent. At its last meeting on 24 November, the committee unexpectedly raised rates for the first time in more than two years.
