For the first time in 2024, Egypt's interest rate has stabilized. The Central Bank announced on Monday that the rate is now 27.75%, following two consecutive hikes totaling 800 basis points.
Egypt stabilizes interest rate for the first time in 2024
An Egyptian walks past an exchange office in Cairo, Egypt, Wednesday, March 6, 2024.
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Inflation also fell to 28.1% in May, down from 32.5% in April.
This stabilization follows the government's decision to liberalize the Egyptian pound's exchange rate on May 23.
The Central Bank attributes this success to its monetary tightening policy, which has reduced inflation and stabilized exchange rates.
The Central Bank's report forecasts that inflation will continue to decline in 2024 as inflationary pressures ease, with a significant drop expected in the first half of 2025.
The high inflation of the past year was mainly due to rapid money supply growth. However, recent measures to reduce excess liquidity, eliminate the parallel currency market, and lower inflation indicate ongoing progress.