The central bank of Egypt maintains stable overnight interest rates

As anticipated, Egypt’s central bank maintained its overnight interest rates on Thursday, stating that although inflation was predicted to drop significantly in early 2025, it was still high.

In a statement, the bank’s monetary policy committee maintained the deposit rate at 27.25% and the loan rate at 28.25%.

Twelve analysts surveyed by Reuters all agreed that the committee will maintain current rates.

Egypt’s headline inflation has been declining since reaching a record high of 38.0% in September 2023, and it dropped to 25.5% in November, its lowest level since December 2022.

“Inflation is projected to ease substantially in 2025, as the cumulative impact of monetary policy tightening and favorable base effect materializes, with a notable decline in Q1 2025 and convergence to single digits by H2 2026,” stated the statement.

The report went on to say that economic growth picked up speed in the second half of 2024 compared to the 2.4% increase in the second quarter, based on leading indications.

“The committee judges that the current policy rates remain appropriate to maintain a tight monetary stance until a significant and sustained decline in inflation is achieved, and expectations are firmly anchored,” read the statement.