Egypt’s net foreign reserves rise to US$45.457 bn in January

Egypt’s net foreign reserves rose to US$45.457 billion in January 2020 from $45.420 billion in December 2019, an increase of $37 million, the Central Bank of Egypt said on Thursday.

Net foreign reserves in the Central Bank of Egypt at the end of November stood at about $45.354 billion.

Foreign exchange reserves witnessed a steady increases after the flotation of the Egyptian pound in 2016, when Egypt devalued its currency by 48 percent, allowing it to float freely, in order to meet a key demand by the IMF and secure a three-year $12 billion loan from the fund.

Economic reforms also involved subsidy cuts and a value-added tax, and inflation rates later accelerated to 33 percent, which was accompanied by a sharp decline in earnings, according to Bloomberg.

However, inflation has declined, approaching the lowest level in years, Bloomberg reported in November 2019. 

A decline in the dollar this December also put the exchange rate below the LE16 mark for the first time in three years. In late January, US dollar prices reached LE15.76 for purchase and LE15.86 for sale in the Arab African International Bank (AAIB), and LE15.73 for purchase and LE15.83 for sale in the Commercial International Bank (CIB).

Former vice president of the BLOM Egypt Bank Tarik Metwally said previously that the dollar decline was normal, adding that he expected the trend to continue in light of efforts to improve the deficit in trade balance, the increase in foreign exchange earnings from tourism, foreign investment in treasury bills, and remittances of Egyptians abroad.

Edited translation from Al-Masry Al-Youm

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