The Monetary Policy Committee at the Central Bank of Egypt is set to hold today its first meeting of 2016 to decide on policy rates. We expect rates to remain on hold with December annual inflation figure stabilised at 11.1%, after a few months of acceleration, with inflation largely stable across the board. Core inflation has also decelerated marginally to 7.2% Y-o-Y in December from 7.4% Y-o-Y in November. In that respect, with the CBE having increased policy rates by 50 basis points in the previous meeting on 24 December, we expect policy rates to remain on hold. We note though that with inflation remaining at five-year high, USD-EGP likely to be subject to further weakening and new fiscal measures should be enacted sometime in 2016, we continue to expect another rate hike of 50 basis points in 2016. (Mohamed Abu Basha)