OEXN reported: On March 6, local time, Egypt's currency --- Egyptian pound once ** to 1 US dollar to 5055 Egyptian pounds, it is worth mentioning that the official exchange rate of the Egyptian pound has been kept around 31 Egyptian pounds per dollar for the past year.
"In order to save the economy in crisis, in order to obtain billions of dollars in new loans from the IMF, Egyptian officials reached an agreement with the IMF, including abandoning exchange rate intervention, and raising interest rates by 600 basis points in response to inflationary pressures, as soon as the news came out, the Egyptian exchange rate was once ** nearly 40%." ”
He pointed out that in Egypt in 2024, Egypt will further tighten monetary policy as a way to fight inflation, and S&P analysts expect the country's inflation rate to reach 303%, slightly lower than in 2023.
Why did Egypt come here?
In an interview with OEXN, Goldman Sachs analysts said: "Egypt has about 1With a population of 100 million, but 60% of them live below or near the poverty line, the Federal Reserve's tightening monetary policy has exacerbated Egypt's foreign exchange shortage, and it is reported that about $20 billion of hot money has fled the Egyptian market as investors seek higher interest rates. The country is currently facing a chronic shortage of foreign exchange, which is affecting local business activity.
Over the past two years, Egypt has experienced an economic crisis and hyperinflation, and the Egyptian pound has experienced three depreciations since 2022, with the market believing that it may depreciate again in 2024.
At the same time, the International Monetary Organization lowered its forecast for Egypt's economic growth, from 5% to 4 percent in 20247%, and its rating outlook was also downgraded to negative from "stable".
At the same time, Egypt's debt crisis is also imminent, and 292 will need to be repaid in 2024, 2025, and 2026$300 million, 194$300 million and 229$400 million in external debt. Fitch** Egypt's macroeconomic situation will remain challenging in 2024 and 2025, and its credit profile remains worrisome.