EL7.AI
Central BanksMedium•29 October 2026•
2 min read

Egypt’s Central Bank Raises Rates by 100 Basis Points in First Hike Since March 2024

Key Facts

1The Central Bank of Egypt raised rates by 100 basis points on October 29, 2026, its first hike since March 2024.
2The deposit rate reached 20%, up from 19%, and the lending rate reached 21%, up from 20%.
3Annual urban inflation fell to 13.9% in September from 14.5% in August, while core inflation declined to 14.1% from 14.9%.
413 analysts expected rates to remain unchanged for a sixth consecutive meeting before the bank raised them.
5The pound hit a record low of 56 pounds per dollar on October 26, 2026.

The Central Bank of Egypt raised its key interest rates by 100 basis points on October 29, 2026, its first increase since March 2024, Reuters reported, citing the bank. The overnight deposit rate rose to 20% from 19%, while the lending rate increased to 21% from 20%. The decision came amid difficult external conditions and heightened uncertainty, according to the bank. The bank said the move aims to "anchor expectations and protect the disinflation path." The rationale puts price expectations at the center of the decision, despite a decline in annual inflation rates in September.

The decision ran counter to a Reuters poll of 13 analysts published on the Tuesday before the meeting. Respondents had expected interest rates to remain unchanged for a sixth consecutive meeting. But the bank raised the deposit rate by one percentage point, from 19% to 20%, and increased the lending rate by the same amount, from 20% to 21%. The move therefore went against the prevailing expectation among the analysts surveyed. The previous rate hike was in March 2024, making the October increase the first upward change since then.

The decision followed a slowdown in annual urban inflation to 13.9% in September 2026, from 14.5% in August, Reuters reported. Annual core inflation also fell to 14.1% from 14.9% over the same period. Both annual measures therefore declined between August and September, while the bank said its decision aims to protect the disinflation path. The bank linked its move to anchoring inflation expectations amid difficult external conditions and heightened uncertainty. The stance places the bank’s stated objective alongside the latest annual inflation readings reported by Reuters.

On economic activity, the bank expects growth in the third quarter of 2026 to remain broadly stable, near the 4.7% rate recorded in the second quarter. This estimate provides context for the rate hike at a time when the bank expects growth to remain close to the previous quarter’s level. Reuters also reported that the Egyptian pound hit a record low of 56 pounds per dollar on Monday, October 26, according to LSEG data. That came three days before the rate decision. The decision’s context thus combines the bank’s expectation of stable growth, September’s declines in annual inflation, and the currency level recorded in late October.

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