The Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) decided on Thursday to maintain its key policy rates, keeping the overnight deposit rate at 21.00%, the overnight lending rate at 22.00%, and the rate of the main operation at 21.50%. The discount rate was also left unchanged at 21.50%.
The CBE said the decision reflects the Committee’s updated assessment of inflation dynamics and the economic outlook.
According to the CBE, Global conditions remain uncertain, with recovering growth overshadowed by trade-policy tensions and persistent geopolitical risks. Central banks worldwide have therefore maintained a cautious approach to monetary easing. Commodity markets remain relatively stable, with oil prices broadly unchanged and agricultural prices declining, though inflation risks persist due to potential supply-chain disruptions.
Domestically, Egypt’s real GDP growth edged up to 5.2% in Q3 2025, compared to 5.0% in the previous quarter, supported by strong activity in non-petroleum manufacturing, trade, and tourism. The CBE expects capacity utilization to reach its full potential by the end of FY 2025/26. The unemployment rate rose slightly to 6.4% in Q3, up from 6.1% in Q2.
Inflation moved higher in October, with annual headline inflation reaching 12.5% and core inflation rising to 12.1%, driven by increases in nonfood prices, particularly in services. The CBE noted that further easing in underlying inflation pressures is necessary to move closer to its target.
The Bank expects headline inflation to rise modestly toward the end of Q4 2025 due to energy price adjustments, before gradually declining in the second half of 2026. However, the outlook remains exposed to risks stemming from geopolitical tensions, persistent services inflation, and potential larger-than-expected passthrough from administered price changes.
Given these uncertainties, the MPC said it is maintaining a “wait-and-see” approach to contain inflationary pressures, anchor expectations, and guide inflation back toward the 7% ±2 p.p. target in Q4 2026.
The Committee reaffirmed that its decisions will continue to rely on incoming data and the balance of risks and that it stands ready to adjust policy tools as needed to preserve price stability.