The Central Bank of Egypt (CBE) has announced that net foreign exchange reserves (forex) reached $40.36 billion by the end of March, reflecting a growth of approximately 14.4 percent compared to the previous month’s figure of $35.31 billion.
Read more: Egypt’s net foreign assets deficit shrinks by $7.04 billion in February
In February, Egypt entered into a partnership with the UAE to develop the city of Ras El Hekma on the north coast, involving a foreign direct investment of $35 billion. The completion of this investment was expected within two months.
Due to specific circumstances, the CBE canceled the scheduled Monetary Policy Committee (MPC) meeting on March 28. Instead, a special MPC meeting took place on March 6, 2024. During this meeting, the Central Bank raised interest rates by 600 basis points or 6 percent, bringing the new rate to 27.25 percent. The decision to increase the base rate was intended to tighten monetary conditions in line with the target plan to reduce inflation rates. These interest rate levels will be maintained until inflation aligns with the intended course.
The International Monetary Fund (IMF) has approved a long-awaited loan of $8 billion to Egypt, surpassing the previously discussed amount of $3 billion. This approval came after the Egyptian pound was devalued to an unprecedented low of EGP49 per dollar, down from around EGP30.85. The devaluation was part of the IMF’s support program, which required the adoption of a more flexible exchange rate.
For more news on banking & finance, click here.
