CBE cuts key policy rates by 100 bps
Updated 10/2/2025 6:24:00 PM
Arab Finance: The Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) has lowered its key policy rates by 100 basis points at its meeting on October 2nd, as per a press release.
The CBE’s overnight deposit rate now stands at 21%, the overnight lending rate at 22%, and the rate of the main operation at 21.5%. The discount rate was also reduced to 21.5%.
The decision comes as inflationary pressures continue to ease. Egypt’s annual headline inflation slowed to 12% in August 2025, down from 13.9% in July. Core inflation followed a similar trend, declining to 10.7% in August from 11.6% the previous month.
According to CBE estimates, inflation is projected to average between 12% and 13% in the third quarter (Q3) of 2025, compared with 15.2% in Q2 2025.
Looking ahead, the central bank expects inflation to moderate further, though at a slower pace, due to persistent non-food inflation and the impact of fiscal measures.
Headline inflation is forecast to average around 14% in 2025 and is expected to gradually converge toward the CBE’s target range in Q4 2026.
The MPC reaffirmed its commitment to price stability, noting it will continue to closely track economic and financial conditions.
The CBE aims to steer inflation to 7% (±2 percentage points) by Q4 2026, and further down to 5% (±2 percentage points) by Q4 2028, on average.
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