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