CAIRO, EGYPT / RankWire.AI / – On Thursday, Egypt’s central bank decided to keep its benchmark interest rates steady, preserving the levels established in February. The Monetary Policy Committee maintained the overnight deposit rate at 19.00% and the overnight lending rate at 20.00%. Additionally, the main operation rate and discount rate were held at 19.50%. The Central Bank of Egypt indicated that this decision was made after reviewing inflation figures, current economic conditions, and potential risks to the inflation outlook.
Official data show that annual urban headline inflation declined to 14.5% in August from 14.9% in July. Monthly urban inflation increased slightly by 0.1% after remaining flat in July. During the same period, core inflation experienced an upward trend, with the annual core rate rising from 14.7% to 14.9%, while the monthly core inflation was 0.3%. These statistics indicate a moderation in headline inflation, although the core measure continues to stay high.
The decision in September follows a series of unchanged interest rates after a rate cut earlier in the year. In February, the committee reduced rates by 100 basis points, lowering the deposit rate to 19.00%, while the lending rate decreased to 20.00%. The Central Bank of Egypt also lowered the required reserve ratio for commercial banks from 18% to 16% in the same month. Since then, rates have remained at their current levels.
Inflation persists above the central bank’s target range
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 continued to stay above this target range. Recent monthly data reveal limited fluctuations in consumer prices. Urban prices fell by 0.4% in June, remained unchanged in July, and rose by 0.1% in August. Yearly urban inflation moved from 14.3% in June to 14.9% in July before easing slightly in August.
Meanwhile, core inflation followed a different trend during the same period. The measure increased from 14.3% in June to 14.7% in July and reached 14.9% in August. Excluding certain volatile items, core inflation offers an alternative gauge of underlying price trends. These latest figures were part of the data reviewed by the Monetary Policy Committee prior to its September decision. The authorities continue to publish monthly inflation updates alongside scheduled interest rate announcements.
Egypt holds borrowing costs steady amid stable economic indicators
Egypt’s external financial metrics also played a role in the decision-making process before the rate decision. Provisional figures from the central bank show that net international reserves stood at $57.2145 billion at the end of August. This reserve level was reported alongside other monetary and financial data released during that month. The country maintains regular updates on reserves, inflation, exchange rates, and banking conditions through official economic reports.
The September meeting marks the sixth scheduled monetary policy gathering of 2026. February remains the only month this year when key policy rates were altered. The official calendar lists two additional meetings scheduled for October 29 and December 17. Until further notice, the deposit rate stays at 19.00% and the lending rate remains at 20.00%. Both the main operation rate and discount rate continue to be set at 19.50%.