The Central Bank of Egypt kept its key interest rates unchanged Thursday, maintaining a restrictive monetary stance as inflation continues to moderate but regional and external risks remain elevated.
The Monetary Policy Committee kept the overnight deposit rate at 19% and the overnight lending rate at 20%. The main-operation and discount rates remain at 19.50%.
Annual urban inflation slowed to 14.5% in August from 14.9% in July. Core inflation, however, edged higher to 14.9% from 14.7%.
The central bank said economic growth slowed to 4.7% in the second quarter of 2026 from 5.0% in the first quarter.
For fiscal 2025/26, real GDP growth averaged 5.1%, and the central bank expects growth to remain broadly around that level during fiscal 2026/27.
The CBE expects headline inflation to remain broadly stable during the third quarter before gradually declining toward its 7%, plus or minus two percentage points, target during the second half of 2027.
The decision reflects the balancing act confronting Egyptian policymakers.
Inflation has fallen substantially from earlier peaks, but renewed energy and geopolitical risks make aggressive monetary easing more difficult.
The central bank therefore retains substantial real and nominal policy restraint while waiting for clearer evidence that inflation is moving sustainably toward target.
Markets will watch inflation, energy prices, the Egyptian pound and regional developments for indications of when the CBE may be comfortable resuming rate cuts.
