Key Policy Rate (CBE) in Egypt

Egypt's official interest rate: the overnight deposit rate set by the Central Bank of Egypt (CBE). It is the benchmark for Egyptian monetary policy; the CBE also sets the overnight lending rate and the main operation rate within a corridor around it.

It is not a statistic: the CBE's Monetary Policy Committee (MPC) decides the level at its meetings (eight a year), guided by inflation and the economic situation. The decision is announced the same day and takes effect within a few days.

A hike raises borrowing costs to curb inflation and tends to strengthen the Egyptian pound (EGP); a cut cheapens credit to support the economy. Given Egypt's high inflation, its decisions are closely watched by debt and currency investors.

It changes only on decision dates (a step function). The CBE also manages the exchange-rate regime and the reserve requirement, which interact with the policy rate and can matter as much as it for monetary conditions.