The good news continues as unemployment rate falls to 7.5%: Egypt’s unemployment rate fell to 7.5% in 2Q2019, down from 9.9% in 2Q2018 and 8.1% in 1Q2019, Planning Minister Hala El Said said at a cabinet meeting on Thursday. With Egypt’s non-oil business activity growing in July and a level of optimism expressed by businesses for the year appearing palpable in the last Markit / Emirates NBD PMI reading, it wouldn’t be too much to expect unemployment to decline further in 3Q2019. The announcement comes almost a week since Capmas released data showing Egypt’s poverty rate rising in FY2017-2018 to 32.5% from 27.8% in 2015, causing some analysts to question whether the reforms have been trickling down to the average person on the street.

Another argument in favor of a rate cut: Analysts see interest rate cuts as part of a wider macro solution. “The situation is still weak and getting weaker in terms of demand, and that’s got to do with interest rates being high,” Naeem Holdings’ Allen Sandeep told Bloomberg last week, adding that “private investments won’t really take off until the cost of capital drops.”