“The large devaluation of the currency and increase in interest rates will likely help Egypt maintain an upsized IMF program, reduce the risk of a renewed build-up of external imbalances, and strengthen the economy's shock resilience"
Maait views this revised outlook as an indication of confidence in Egypt's adept handling of macroeconomic affairs during a challenging period, as well as the effectiveness of policies implemented to withstand various shocks over the past years.
The positive outlook “reflects significant official and bilateral support announced and marked policy steps taken in the past week that will, if maintained, support macroeconomic rebalancing,” the note said
Continued foreign currency shortages, difficult operating conditions, and high asset risks were main contributors to the new outlook, noting that it may impact banks’ operations and place further pressure on various aspects of operations
The finance minister, Mohamed Maait, added that the government’s Initial Public Offering (IPO) program strengthens Egypt's ability to meet its financing needs over the next two years and attract more investment inflows, reducing the need for external financing
