Bishai explained that the decision was supported by a
decline in the annual inflation rate in Egyptian cities to 12% in August,
compared to 13.9% in July. He noted that data from the Central Agency for
Public Mobilization and Statistics reflected the start of a downward trend in
price hikes. Core inflation, which excludes volatile items such as food and
fuel, also fell to 10.7% in August from 11.6% in July.
This decline, he said, reassured the Central Bank that the
tight monetary policy pursued over the past two years is beginning to yield
results. Inflation is expected to continue easing to around 14% in the fourth
quarter of 2025, before reaching the official target of 7% (±2%) by the end of
2026.
In press statements, Bishai stressed that the decision will
help reduce the cost of servicing public debt and ease financing costs for
institutions and companies. He added that it reflects the economy’s ability to
absorb past shocks and maintain relative price stability.
The decision, he noted, will also directly benefit citizens
by reducing the burden of loans, whether for car purchases or housing units.
This will boost purchasing power and generate overall savings, giving strong
momentum to economic activity.
Bishai concluded that current monetary policies, combined
with improved foreign investment flows and a stable exchange rate, will support
the downward path of inflation in the coming period. He emphasized that the
move sends a positive signal to global markets, showing that Egypt is moving
steadily toward economic stability. This, in turn, could enhance investor
confidence and lower the cost of external borrowing.