The Central Bank of Egypt (CBE) has decided to keep rate at which banks lend money and the rate they pay on deposits steady even as inflation keeps falling. The bank's monetary policy committee kept the lending rate at 28.25% and the deposit rate at 27.25%, it said in a statement.
In November, Inflation fell to 25.5%—its lowest point in almost a year—after peaking from 38.0% in September 2023. The central bank believes that the inflation will continue to fall significantly in 2025.
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“Inflation is set to ease substantially in 2025, as the cumulative impact of monetary policy tightening and favorable base effect materializes, with a notable decline in Q1 2025 and convergence to single digits by H2 2026,” the apex bank made it clear.
The Egyptians central bank expects a surge drop early in 2025 and believes it will be much lower by the second half of 2026. However, the country's economy seems to be growing faster now than it was earlier in 2024.
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The central bank has concluded on keeping the interest rates high to make sure the country’s inflation continues to fall. The bank is aiming towards taking the prices under control first before it consider lowering interest rates.
“The committee judges that the current policy rates remain appropriate to maintain a tight monetary stance until a significant and sustained decline in inflation is achieved, and expectations are firmly anchored,” the statement said.
