UPDATE: Egypt’s central bank keeps key rates unchanged as inflation pressures persist

Egypt’s central bank on Thursday kept its key interest rates unchanged, saying inflation remains subject to upside risks and that more evidence of easing price pressures is needed before shifting its policy stance.

The Monetary Policy Committee (MPC) kept the overnight deposit rate at 21.00 per cent, the overnight lending rate at 22.00 per cent, and the main operation, and discount rates at 21.50 per cent, the Central Bank of Egypt (CBE) said in a statement.

Headline inflation accelerated to 12.5 per cent in October from 11.7 per cent in September, while core inflation increased to 12.1 per cent from 11.3 per cent, the CBE said. A pickup in non-food price pressures, especially services, outweighed easing food inflation.

Inflation is expected to rise further toward the end of the fourth quarter as energy price increases take effect, before gradually easing through the second half of 2026 and converging toward the CBE’s target of 7 per cent ±2 percentage points.

However, the central bank warned that inflation risks remain elevated due to geopolitical tensions, persistent services inflation and a potentially larger-than-expected passthrough from changes in state-administered prices.

Given this backdrop, the Committee “has favoured a wait-and-see approach, deciding to keep the CBE key policy rates unchanged with a view to containing inflationary pressures, anchoring expectations, and restoring the disinflation path.” the statement read.

Attribution: Amwal Al Ghad English