IMF urges tighter monetary policy in Egypt
The article focused on the International Monetary Fund's call for Egypt to tighten monetary policy to contain inflation, which is expected to reach 17% by September 2026. The Fund announced that inflation has risen significantly since the beginning of the year, and raising interest rates has become a viable option if inflation exceeds 18% or if other shocks occur, such as a spike in oil prices or a decline in the Egyptian pound. Although the Central Bank of Egypt previously lowered interest rates, it suspended further cuts due to rising fuel and energy costs. It seems that policy-makers prefer to exercise caution, waiting for inflation to stabilize, with warnings that raising interest rates would be costly for the government due to higher debt service costs. Nonetheless, an inflation rate above 18% remains the main indicator for taking tightening measures.
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