{"id":678392,"date":"2025-12-26T00:00:00","date_gmt":"2025-12-26T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/?p=678392"},"modified":"2025-12-26T00:32:25","modified_gmt":"2025-12-26T00:32:25","slug":"monetary-policy-committee-cuts-interest-rates-by-100-basis-points-in-final-2025-meeting","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2025\/12\/26\/monetary-policy-committee-cuts-interest-rates-by-100-basis-points-in-final-2025-meeting\/","title":{"rendered":"Monetary Policy Committee cuts interest rates by 100 basis points in final 2025 meeting"},"content":{"rendered":"

Good morning, friends, and a very Merry Christmas to all who celebrate. And as <\/strong>always, happy weekend \u2014 the last of 2025.<\/strong> Next time we see you will be in the new year. We\u2019re polishing things up to start the year off right, and are excited for many more returns with you, dear reader.<\/p>\n

There\u2019s no better time to bundle up with a hot drink and a good book than the <\/strong>holidays. <\/strong>This week\u2019s guide is a list of our favorite reads, dedicated to our fellow bookworms, those dusting off their reading lists in the wake of the new year, and perhaps those doing some (very) late Christmas shopping for a bibliophile.<\/p>\n

Enterprise Weekend comes out each Friday at 9:00am CLT.<\/strong> We\u2019ll be back on Sunday at 6am with EnterpriseAM. Until then: Enjoy the weekend.<\/p>\n

?\ufe0f LAST WEEK IN 3 MINS-<\/p>\n

ECONOMY-<\/strong><\/p>\n

#1- The Monetary Policy Committee resolved to reduce interest rates by 100 basis points at its final meeting of the year, held on Thursday, <\/strong>according to a statement<\/a> issued by the Central Bank of Egypt. The committee lowered the overnight deposit rate, the overnight lending rate, and the central bank\u2019s main operation rate to 20%, 21%, and 20.5% respectively. The credit and discount rate was also reduced by 100 basis points, bringing it to 20.5%.<\/p>\n

The decision reflects the committee\u2019s assessment of recent inflation developments and projections held by the majority of analysts and economic experts<\/strong> surveyed<\/a> by EnterpriseAM, who indicated that the IMF\u2019s concern that the disinflatory trajectory \u201chas not yet been firmly established\u201d would likely not dissuade the MPC from proceeding with a rate cut.<\/p>\n

#2- The Finance Ministry has begun drafting a state budget that marks a definitive end to the current era of economic emergency.<\/strong> The FY 2026-27 budget \u2014 set to be presented to Cabinet in preliminary form by late January \u2014 is being<\/a>designed<\/a> as a structural shift in fiscal policy, a senior government official tells EnterpriseAM.<\/p>\n

MANUFACTURING- <\/strong><\/p>\n

The Sokhna Industrial Zone is getting USD 1.2 bn-worth of fresh investment from three Chinese industrial players<\/strong>, according to a cabinet statement<\/a>. The three projects \u2014 which will be set up in the Chinese-operated Teda industrial zone \u2014 will serve the spinning and weaving, heavy, and advanced sanitary industries and are expected to create a total of 5.4k jobs.<\/p>\n

AUTOMOTIVE-<\/strong><\/p>\n

#1- MM Group (MTI) and Abu Dhabi Motors (ADM) are placing a strategic bet on Egypt\u2019s ultra-luxury market, <\/strong>securing exclusive dealerships<\/a> for Lamborghini and Rolls-Royce, industry insiders told EnterpriseAM. The move firms up Egypt\u2019s ultra-luxury automotive segment, with both dealerships expected to start operations early in the new year.<\/p>\n

#2- Industry insiders are betting that 2026 will be the year of <\/strong>range-extended electric vehicles<\/a> (REEVs) in Egypt<\/strong>. One of them, Abu Ghaly Motors Vice President Tamer Kotb, goes so far as to say that REEVs could account for as much as 50-60% of new car sales in Egypt in the coming year.<\/p>\n

DEBT WATCH- <\/strong><\/p>\n

#1- The IMF has <\/strong>signed off<\/a><\/strong> on two key reviews of our USD 8 bn assistance package \u2014 and it should be music to the business community\u2019s ears.<\/strong> The result should be c. USD 3.8 bn flowing into the government\u2019s coffers when the IMF\u2019s executive board signs off on the reviews in January.<\/p>\n

#2- The Finance Ministry is set to issue EGP 5 bn in local sovereign Sukuk <\/strong>next Monday<\/a><\/strong>, with settlement scheduled for Tuesday. This latest issuance brings the total raised under the current sovereign Sukuk program to EGP 20 bn, a target of EGP 200 bn by the end of the current fiscal year in June 2026.<\/p>\n

TAX-<\/strong><\/p>\n

#1- The Egyptian Tax Authority is <\/strong>set to launch<\/a><\/strong> a centralized system in early 2026 specifically designed to fast-track corporate liquidation.<\/strong> The move targets the market\u2019s exit problem \u2014 where bureaucratic hurdles and open tax files prevent companies from legally closing \u2014 by resolving a massive backlog of disputes that has historically left investors trapped.<\/p>\n

#2- The threshold that exempts companies from filing detailed transfer pricing documentation <\/strong>has now doubled to EGP 30 mn<\/a><\/strong>, effective immediately for the current tax period. The decision means companies whose annual transactions with related parties fall below the new EGP 30 mn mark are no longer required to submit a master file, local file, or country-by-country report.<\/p>\n

ENERGY-<\/strong><\/p>\n

Egypt has <\/strong>shelved plans<\/a><\/strong> to phase out its floating storage and regasification units (FRSUs) in the near term<\/strong>, opting instead to keep the vessels as a strategic backup until at least 2030.<\/p>\n

M&A WATCH-<\/strong><\/p>\n

EGX-listed Raya Holding\u2019s board <\/strong>approved an updated offer<\/a><\/strong> from Africa-focused private equity outfit Helios Investment Partners to fully acquire Raya Foods.<\/strong> Shareholders will be able to evaluate the offer once the independent financial advisor determines a fair value for Raya Foods and board-quarterbacked negotiations wrap up.<\/p>\n

LOGISTICS- <\/strong><\/p>\n

The Transport Ministry is in advanced talks to <\/strong>launch<\/a><\/strong> a series of mega-projects <\/strong>focused on shipbuilding and marine shipyards with the China State Shipbuilding Corporation (CSSC) and a consortium of Chinese maritime giants<\/p>\n

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? AROUND THE WORLD IN SEVEN DAYS- <\/p>\n

<\/p>\n

It was a relatively calm week in the business press<\/strong>, as is expected this time of the year. Here are the top headlines of the week:<\/p>\n