Egypt’s central bank keeps interest rates unchanged

CAIRO – 27 June 2025: The Central Bank of Egypt (CBE) decided to hold key interest rates steady for the fourth consecutive meeting this year, maintaining its tight monetary stance in the face of inflationary pressures and global economic uncertainty.

Following its Monetary Policy Committee (MPC) meeting on Thursday, the CBE kept the overnight deposit rate at 27.25 percent, the overnight lending rate at 28.25 percent, the main operation rate at 27.75 percent, and the discount rate also at 27.75 percent.

The central bank cited continued global volatility, rising geopolitical tensions, and the lingering effects of protectionist trade measures as factors behind its decision. While inflation has shown signs of easing, the CBE said risks remain, particularly for food prices and supply chains.

On the domestic front, the economy showed signs of recovery, with GDP growth reaching 3.5 percent in the fourth quarter of FY2023/2024, up from 3.2 percent in the previous quarter, driven by stronger activity in manufacturing and transport. Meanwhile, the unemployment rate edged down to 6.4 percent.

Inflationary pressures have begun to moderate. Headline inflation stood at 24 percent in January 2025, while core inflation remained stable. The CBE noted that the food inflation rate eased to 22.6 percent, while non-food inflation was recorded at 20.8 percent.

Despite this deceleration, the bank noted that inflation expectations are still subject to risks from global developments and local fiscal adjustments. It forecast a gradual decline in inflation over the medium term, supported by tighter monetary policy and a favorable comparison base.

The MPC emphasized its readiness to respond to future shocks, stating that interest rate decisions will continue to be based on inflation trends and incoming economic data.

“The committee remains committed to ensuring inflation returns to target in a sustainable manner,” the statement concluded, reaffirming the CBE’s intention to use all available tools to safeguard macroeconomic stability.