Video|13 March 2025

MENA | Can Egypt’s Inflation Drop Spark a Rate Cut?

Scott Livermore
Scott Livermore
Chief Economist & Managing Director
MENA | Can Egypt’s Inflation Drop Spark a Rate Cut?


Egypt’s headline inflation tumbled to 12.8% in February from 24% in January, falling to a three-year low. The sharp decline was mostly driven by base effects, effective economic reforms, and a very tight monetary policy stance over the past year. With real interest rates climbing above 14%, the central bank now has ample space to start monetary easing, and we anticipate a 300bps rate cut in April.

Fitch affirmed Kuwait’s ‘AA-‘ sovereign credit rating with a stable outlook, citing its solid net foreign assets, robust external balance sheets, and low public debt. This aligns with our optimism about Kuwait’s fiscal sustainability. We see a wider fiscal deficit this year given our lower oil price forecast, but think we’re nearing the approval of the long-awaited debt law to unlock capital for Kuwait Vision 2035, alongside measures to bolster non-oil revenues.


Our latest videos

MENA in a Minute

Relevant Content

Middle East Key Themes 2025: Ahead of the race

Middle East Key Themes 2025: Ahead of the race

We’re optimistic about GCC’s outlook for 2025 as oil production gradually increases, providing a boost to the region’s economies.
GCC: Key themes shaping city economies in the near term

GCC: Key themes shaping city economies in the near term

For Gulf cities, the near-term outlook will be tied not only to the global macroeconomic backdrop, but also the progress of the diverse visions and strategies in the region. With the aim to diversify their economies and reduce the dependence on oil, Gulf states continue to invest in the non-oil economy and implement various reforms. That said, oil revenues remain key to funding diversification efforts.
Iran-Israel tensions should dissipate after latest flare up

Iran-Israel tensions should dissipate after latest flare up

The military escalation between Iran and Israel has ratcheted up fears of an expanded Middle East conflict. The threat of counter strikes by Israel is clearly heightened, but we think both sides will ultimately seek to avoid a costly all-out war.

  • Share: