Egypt’s central bank cut its overnight interest rates by 100 basis points yesterday, it said in a statement.
The monetary policy committee cut the overnight deposit rate to 20 per cent from 21pc and the lending rate to 21pc from 22pc.
The central bank expected real GDP growth to reach around 5pc in the fourth quarter of 2025, compared to 5.3pc 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 14pc in 2025, down from 28.3pc the previous year.
Egypt’s annual urban consumer inflation edged lower to 12.3pc in November, while core inflation, which strips out volatile items such as food and fuel, rose to 12.5pc on an annual basis in November from 12.1pc.
The central bank targets inflation of around 7pc +/- 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.
Meanwhile, the government said it will impose no new burdens on citizens in the energy sector, including petroleum and natural gas, as it moves towards the final year of its economic reform programme with the International Monetary Fund.
Prime Minister Mostafa Madbouly said the targets agreed with the IMF through the end of the program “do not relate to anything that affects the Egyptian citizen,” seeking to counter speculation about additional austerity measures.
Speaking at the weekly Press conference following a cabinet meeting in the New Administrative Capital, Madbouly said the IMF has completed the fifth and sixth reviews of Egypt’s reform program.
A Facebook post on the official Egyptian Cabinet Presidency page stated: “The Prime Minister explained that the IMF program will end within a year from now, noting that what has been done during the current stage is to follow up on the targets of the fifth and sixth reviews, in addition to agreeing on the targets of the two remaining reviews in the program, the seventh and eighth, which required more effort on the part of the Egyptian government to reach an understanding with the fund on the targets of these two reviews.”
The prime minister said IMF assessments praised Egypt’s stabilization efforts, citing improved balance-of-payments indicators and a narrowing current-account deficit despite external shocks.
He pointed to stronger non-oil exports and fiscal performance, including a primary surplus of 3.5 percent of gross domestic product in fiscal year 2024-25, alongside higher tax revenues and monetary policies aimed at easing inflation.
Such evaluations matter for capital flows, Madbouly said, as foreign investors closely track IMF reporting when making investment decisions.
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