CAIRO, EGYPT / RankWire.AI / – Egypt’s central bank announced on Thursday that it would keep its benchmark interest rates at their current levels, following a decision made 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 remained unchanged at 19.50%. The Central Bank of Egypt stated that the decision was based on its review of inflation, the economic environment, and the risks related to the outlook for prices.
Official data showed that annual urban headline inflation decreased to 14.5% in August from 14.9% in July. Monthly urban inflation increased slightly by 0.1% after remaining stable in July. During the same period, core inflation also rose. The annual core rate went up to 14.9% from 14.7%, with the monthly figure at 0.3%. These figures indicate that while headline inflation eased, underlying core inflation stayed elevated.
This month’s decision continues the trend of holding interest rates steady after a rate cut earlier this year. In February, the committee reduced rates by 100 basis points, bringing the deposit rate down to 19.00%. At that meeting, the lending rate also decreased to 20.00%. The Central Bank of Egypt also lowered the required reserve ratio for commercial banks from 18% to 16% in February. Since then, rates have remained at current levels.
Inflation Still Exceeds the Central Bank’s Target Range
Egypt aims for an inflation target of 7%, with a margin of plus or minus 2 percentage points, over the fourth quarter of 2026. However, August’s headline inflation stayed above this range. Recent monthly data shows limited changes in consumer prices. Urban prices fell by 0.4% in June, remained unchanged in July, and increased by 0.1% in August. Yearly urban inflation moved from 14.3% in June to 14.9% in July before easing slightly in August.
Core inflation followed a different pattern during this period. It rose from 14.3% in June to 14.7% in July and reached 14.9% in August. This measure excludes certain volatile items, offering another perspective on underlying price trends. The latest data was considered by the Monetary Policy Committee before its September decision. The authorities continue to publish monthly inflation figures alongside scheduled interest rate announcements.
Egypt Keeps Borrowing Costs Unchanged Amid Stable Economic Indicators
Egypt’s external financial metrics also remained part of the broader economic data reviewed before the rate decision. As of the end of August, net international reserves reached $57.2145 billion, according to provisional figures from the central bank. This reserve level was reported alongside other monetary and financial statistics released during that month. The country continues to publish regular updates on reserves, inflation, exchange rates, and banking conditions through official reports.
The September meeting marked the sixth scheduled monetary policy gathering of 2026. February was the only session this year that resulted in a change to key policy rates. The official calendar lists two additional meetings scheduled for October 29 and December 17. Until a new decision is announced, the deposit rate stays at 19.00%, and the lending rate remains at 20.00%. Both the main operation rate and discount rate are still set at 19.50%.