A survey conducted by CNBC Arabia, which included 11 analysts and economic experts in local and international companies and investment banks, revealed that declining inflation rates will support the decision to… Central Bank of Egypt By reducing interest rates next Thursday.
Expectations of the central bank’s interest rate decision
Most participants agreed that the central bank will continue the monetary easing cycle at its last meeting of the year.
The Central Bank of Egypt decided to set interest rates at 21% for deposits and 22% for lending last November.
Reasons that support lowering interest rates
Most of the survey participants believe that the slowdown in inflation in Egyptian cities last November to 12.3% will prompt the Central Bank to reduce interest rates next Thursday for the fifth time in 2025, at a rate that may range from 1% to 2%.
Regarding the direction of monetary policy during the coming year, survey participants agree that the central bank will continue the monetary easing cycle during 2026 in light of the rise in real interest rates, and expectations that the inflation wave will continue to recede, supported by the stability of the local currency and improved foreign exchange flows, in addition to the need to support the growth of economic activity and reduce the burden of servicing public debt.
Central Bank expectations for inflation rates
The Central Bank of Egypt expects inflation rates to decline during the second half of 2026, approaching targets ranging from 5% to 9% by the end of next year.
He stressed that inflation expectations are still vulnerable to global and local upside risks, which necessitates a cautious approach towards the monetary easing cycle.
