Egypt's central bank cuts key interest rates by 100 bps

Egypt's central bank cut ⁠its overnight interest rates by 100 basis points on Thursday, it said in a statement.

The monetary policy committee cut the overnight deposit rate to 20% from 21% and ‌the lending rate to ‍21% from 22%.

The central bank expected real GDP growth to reach around 5% in the fourth quarter of 2025, compared to 5.3% in the previous quarter. It attributed growth in the third quarter of 2025 to "positive contributions from non-petroleum manufacturing, trade, and communications".

The decision is aligned with a Reuters poll published ⁠on Monday that predicted the bank would lower its overnight interest rates by a median one percentage point, following an easing in inflation in November.

Annual headline inflation is projected to stabilise near the current level in the fourth quarter of 2025, at an average ‌of around 14% in 2025, down from 28.3% the previous year.

Egypt's annual urban consumer inflation edged lower to 12.3% in November, while core inflation, which strips ‍out volatile items such as food and fuel, rose to 12.5% on an ‍annual basis ‍in November from 12.1%.

The central ⁠bank targets inflation of ‍around 7% +/- 2 percentage points in the fourth quarter of 2026. It said, however, that "relatively persistent non-food inflation, and the impact of fiscal measures" pose risks ⁠to the ‌outlook.