Egypt Cuts Interest Rates by 225 Basis Points

Egypt's central bank has cut its benchmark interest rates by 225 basis points, marking the first reduction in nearly five years as inflation has sharply declined from previous record highs. The new lending rate is set at 26% and the deposit rate at 25%. The move follows a period of aggressive monetary tightening and currency devaluation tied to an IMF support package, and comes as annual headline inflation fell to 13.6% in March. Lower inflation, attributed to a favorable base effect and earlier policy actions, has allowed the central bank to begin an easing cycle, with further rate cuts possible. While inflation remains above the bank's target, officials expect it to continue falling in the coming years, and early indicators suggest accelerating economic growth. The decision aims to spur investment and reduce high debt-servicing costs amid ongoing economic and geopolitical uncertainties.