Egypt recorded an annual urban inflation rate of 12.7 percent in October. Official data showed the figure dropped from 13.9 percent in September, reaching a nine-month low.
The Central Agency for Public Mobilization and Statistics published the monthly urban headline consumer price index, which rose by 0.7 percent during October. The rate reached 1.8 percent in the same month last year and stood at 1.3 percent in September.
The Central Bank of Egypt increased its key interest rates by 100 basis points on October 29. This adjustment brought the overnight deposit rate to 20 percent and the lending rate to 21 percent.
Officials at the central bank stated that the policy change aimed to anchor inflation expectations. The measure was designed to safeguard the disinflation trajectory during challenging external conditions.
Figures calculated by the central bank indicated that annual core inflation also moderated, declining to 13.1 percent in October from 14.1 percent in September.
On a monthly basis, core consumer price index inflation increased by 1.2 percent in October. This compared with 2 percent in October 2025 and 0.8 percent in September 2026.
The central bank projected headline inflation to average 16.6 percent in the 2026/27 fiscal year and expects the rate to ease to 8.1 percent in 2027/28.
Monetary authorities anticipate inflation will return to single digits during the second half of 2027. This projection relies on tight monetary policy, though officials noted regional developments could impact domestic prices.
Retail banking firm Emirates NBD issued a statement regarding the interest rate decision. Following the hundred-basis-point increase, the firm expects rates to remain unchanged at the December meeting and through the start of next year, with easing resuming toward mid-2027.
The financial institution projected 400 basis points of cuts next year. This would bring the deposit rate down to 16.0 percent by the end of the year, provided external pressures stabilise.
Emirates NBD warned of specific upside risks to inflation, including renewed pound weakness, higher import costs, and a potential January fuel-price hike.
The S&P Global Purchasing Managers Index survey for October indicated persistent cost pressures. Private sector firms increased their selling prices at the fastest pace since June as input costs continued to climb.
