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Wednesday, 13 November 2019

Egypt’s real interest rates are only outmatched by Argentina thanks to our “steep” inflation slowdown

Egypt’s real interest rates are only outmatched by Argentina thanks to our “steep” inflation slowdown, Abeer Abu Omar writes for Bloomberg. Annual headline inflation dropped to a nine-year low of 2.4% in October, while annual urban inflation decelerated to 3.1%. According to the Bloomberg Barclays Local Currency Government Universal Index, Egypt’s inflation-adjusted bond returns are currently at 9.42%, which is nearly double the 5.14% offered by Turkey. To calculate a sovereign’s real rate of interest, the inflation rate is subtracted from the average monthly yield of 10-year local-currency sovereign debt.

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