Core inflation slows to 10.7% as CBE cuts rates by 200 points

Egypt’s annual core inflation rate eased to 10.7 percent in August, down from 11.6 percent in July, according to a statement from the Central Bank of Egypt (CBE). On a monthly basis, core inflation declined to 0.1 percent, compared with 0.9 percent in August 2024.

At the same time, the Central Agency for Public Mobilization and Statistics (CAPMAS) reported that annual urban inflation dropped to 12 percent in August, from 13.9 percent in July. This represents the lowest level since March 2022, when inflation stood at 10.49 percent.

A Reuters poll released on Tuesday had projected urban inflation to ease to 12.7 percent in August. The slowdown, which has persisted for a third consecutive month, allowed the Central Bank to cut interest rates by 200 basis points at the end of August, bringing total rate cuts since the beginning of the year to 525 basis points.

This decision was backed by a decline in Egypt’s annual headline inflation rate to 13.9 percent in July 2025, down from 14.9 percent in June, while core inflation remained steady at 11.6 percent.

According to the Central Bank’s outlook issued last month, inflation is expected to continue easing, with projections averaging between 14 percent and 15 percent during 2025, moving closer to the Bank’s target range by the fourth quarter of 2026.