CAIRO, EGYPT / RankWire.AI / – In the broader context of its monetary policy stance, Egypt’s central bank has opted to keep its key interest rates unchanged on Thursday, maintaining the levels established in February. The Central Bank of Egypt announced that the Monetary Policy Committee decided to hold the overnight deposit rate at 19.00% and the overnight lending rate at 20.00%. It also maintained the main operation rate and discount rate at 19.50%. The bank explained that this decision was made after reviewing inflation trends, economic conditions, and risks related to the outlook for prices.
Official data indicated that annual urban headline inflation decreased to 14.5% in August from 14.9% in July. Monthly urban inflation experienced a slight increase of 0.1% after remaining flat in July. During the same period, core inflation also rose, with the annual core rate climbing to 14.9% from 14.7%, and the monthly core inflation at 0.3%. These figures suggest that while headline inflation pressures eased, the underlying core measure stayed elevated.
The decision in September continues a period of stable interest rates following a rate cut earlier in the year. In February, the committee reduced rates by 100 basis points, lowering the deposit rate to 19.00%. At that same meeting, the lending rate was reduced to 20.00%. Additionally, the Central Bank of Egypt cut the required reserve ratio for commercial banks from 18% to 16% in February. Since then, rates have remained unchanged.
Inflation stays above the central bank’s target
Egypt aims for an inflation target of 7%, with a margin of plus or minus 2 percentage points, on average during the fourth quarter of 2026. However, August’s headline inflation stayed above this range. Recent monthly data shows limited fluctuations in consumer prices. Urban prices fell by 0.4% in June, remained steady in July, and increased by 0.1% in August. The annual urban inflation rate moved from 14.3% in June to 14.9% in July, then eased slightly in August.
Core inflation followed a different trend during this period. It increased from 14.3% in June to 14.7% in July and reached 14.9% in August. This measure excludes certain volatile items and offers insight into underlying price trends. The latest data was part of what the Monetary Policy Committee reviewed prior to their September decision. The authorities continue to publish monthly inflation figures alongside scheduled interest rate announcements.
Egypt maintains its current borrowing costs
External financial indicators also played a role in the broader economic context before the rate decision. According to provisional central bank figures, net international reserves stood at $57.2145 billion at the end of August. This reserve level was reported alongside other monetary and financial statistics released during the month. Egypt consistently provides updates on reserves, inflation, exchange rates, and banking conditions through official reports.
The September meeting marked the sixth scheduled monetary policy gathering of 2026, with only the February meeting resulting in a change to key policy rates. The official calendar lists two additional meetings scheduled for October 29 and December 17. Until further notice, the deposit rate remains at 19.00%, the lending rate at 20.00%, and both the main operation and discount rates at 19.50%.