Thursday, May 22/2025 – 06:30 PM
The Central Bank revealed that the intensity of the upward risks surrounding inflation prospects has decreased compared to the meeting of the Monetary Policy Committee in April, in light of the decline in the severity of commercial tensions, the developments of the current exchange rate, and the return of the risk index to its usual level, allowing the continuation of the monetary facilitation course that started at the previous meeting of the committee.
The upper risks surrounding inflation
Nevertheless, the Saudi risks It remains an existing and represented in the effects of the global protective commercial policies, the escalation of regional conflicts, and the effects of controlling the public financial conditions of expectations.
The Monetary Policy Committee of the Central Bank of Egypt decided to reduce the price of deposit and lending for one night and the price of the main operation of the Central Bank by 100 basis points to 24.00%, 25.00% and 24.50%, respectively.
It also decided to reduce the price of credit and discount by 100 basis points to 24.50%. This decision comes as a reflection of the latest economic developments and expectations since the previous monetary policy committee meeting.
Reasons for reducing the interest rate on deposit and lending
At the global level, growth forecast has declined since the Monetary Policy Committee meeting in April, which is mainly attributed to successive developments in world trade policies and the possibility of more disturbances in supply chains. Hence, many central banks in the advanced and emerging economies have resorted to a more cautious approach in managing their monetary policies, amid a continuation of uncertainty about the prospects for economic growth and inflation. With regard to the global prices of basic commodities, oil prices are still driven by factors by supply and expectations for a decrease in global demand.
As for the global prices of basic agricultural commodities, it has recorded a less severe decline due to climate -related risks. Despite the decline in inflationary pressure, the upward risks are still surrounding the inflation path, including the exacerbation of geopolitical tensions and the continued unrest in world trade policies.
