Central Bank of Egypt Lowers Interest Rates for First Time in 2025
In a move aligned with the latest economic indicators, the Monetary Policy Committee
(MPC) of the Central Bank of Egypt (CBE) announced on Thursday, October 2, 2025, a 100 basis
point cut to the country’s key policy interest rates This marks a significant development
in Egypt’s monetary policy stance, aimed at addressing inflation dynamics while supporting
economic growth
Details of the CBE Interest Rate Decision
As per the official statement, the Central Bank of Egypt adjusted its
key interest rates as follows
Overnight deposit rate: reduced to 21.00%
Overnight lending rate: lowered to 22.00%
Main operation rate: cut to 21.50%
Discount rate: also decreased by 100 basis points to 21.50%
These changes come as part of the CBE’s strategy to maintain price stability while
responding to shifts in inflation trends in Egypt
Why Did the Central Bank of Egypt Cut Interest Rates
The MPC’s decision reflects an updated assessment of both current and projected
inflationary pressures Since the previous MPC meeting, indicators suggest a moderation
in inflation momentum, giving the committee room to begin easing monetary policy in Egypt
According to the MPC, the move is designed to balance the dual objective of controlling inflation
and stimulating economic activity in the face of global and domestic economic challenges
Impact of the Interest Rate Cut on the Egyptian Economy
This rate cut is expected to have far-reaching implications for Egypt’s economic outlook
Borrowing costs for businesses and consumers are likely to decrease, supporting investment and consumption
Government debt servicing may benefit from lower interest payments
It could contribute to improved investor sentiment in local markets
The move signals confidence in the central bank’s inflation targeting framework
The Central Bank of Egypt’s 100 basis point interest rate cut demonstrates a proactive response
to evolving economic conditions As inflation in Egypt shows signs of easing, this decision
underscores the CBE’s commitment to supporting macroeconomic stability and sustainable growth
The next MPC meetings will be closely watched for further signals regarding the future direction
of monetary policy in Egypt
