Disinflation to continue through 2026, but at slower pace – Egypt’s c.bank

Egypt’s central bank expects inflation to continue easing over the course of 2025 and 2026, although at a slower pace than the sharp decline recorded in the first quarter of this year, it said in a statement on Thursday.

The Central Bank of Egypt (CBE) attributed the expected moderation in disinflation to the lingering impact of recent and upcoming fiscal consolidation measures, as well as the persistent rigidity in non-food inflation, which has proven slower to respond to earlier price shocks.

“The slower disinflation path is attributed to the impact of recently implemented and planned fiscal consolidation measures in 2025, in addition to the downward stickiness of non-food inflation.” the CBE said following its Monetary Policy Committee meeting, during which it cut policy rates by 225 basis points.

While inflationary pressures have eased significantly, the CBE warned that upside risks remain elevated, including the pass-through effects of fiscal reforms, uncertainty from the ongoing US-China trade tensions, and a potential escalation of regional geopolitical conflicts.

Attribution: Amwal Al Ghad English