CAIRO - Urban consumer inflation in Egypt remained unchanged in the year to October, a sign the central bank is unlikely to raise interest rates in December. Inflation in the 12 months to October was 11 percent, the state statistics agency CAPMAS said on its website on Wednesday, on the higher end of analysts forecasts. Six analysts cited forecasts for urban inflation - the most closely watched indicator of prices - that ranged from 10.5 per cent to 11.1 per cent. The average of the forecasts was 10.83 per cent. "The rate is slightly below our estimates ... It is probably because food prices eased a bit in the year to October," said Alia Mamdouh, economist at CI Capital Research, who had forecast inflation would rise to 11.1 per cent. "I think the central bank is going to hold interest rates steady in December," she added, estimating a rate hike could be introduced by the middle of 2011. The central bank on Thursday kept its key overnight interest rates steady at a four-year-low , saying non-food inflation was largely subdued and global economic growth was uncertain. It held its overnight lending rate steady at 9.75 per cent and the deposit rate at 8.25 percent, its ninth pause since it stopped lowering rates in September 2009. It also left the discount rate unchanged at 8.5 per cent. Prices of food and beverages, which account for 44 per cent of the weighting of the basket Egypt uses to measure inflation, slightly dipped to 19.3 per cent in the year to October, from 21.3 per cent in September. Although urban inflation has fallen from a peak of 23.6 per cent in August 2008, it reignited late last year, climbing to as high as 13.6 per cent in January. A Reuters poll of 12 economists predicted GDP growth would reach 5.5 per cent in fiscal year 2010/11, up from 5.2 per cent in the year that ended in June. Egypt last month revised down its gross domestic product growth figure for the April-June quarter to 5.4 per cent from a previously stated 5.9 per cent. The next policy meeting of the central bank's Monetary Policy Committee is scheduled for December 16.
