Egypt inflation and UAE banking assets show divergent trends

In Egypt, core inflation accelerated to 14.9% in August 2026, up from 14.7% in July, according to Central Bank data. However, the annual inflation rate saw a slowdown, dropping to 12.7% from 13% in July. The Central Bank expects inflation to follow a downward path toward a single-digit target of 7% (±2 percentage points) by the second half of 2027, supported by monetary tightening and easing inflationary pressures, though regional tensions remain an upside risk.

In the United Arab Emirates, total banking assets rose 1.3% month-on-month to 5.669 trillion dirhams by the end of July. Total credit grew by 1.5% to reach 2.798 trillion dirhams, driven by a 1.4% increase in domestic credit and a 1.8% increase in foreign credit. Domestic credit expansion was primarily fueled by lending to the private sector, with individual credit rising 2.3% and corporate credit increasing 1.1%. Bank deposits also grew by 1.1% to 3.51 trillion dirhams.