Foreign reserves up in October to hit $35.1 billion | CBE

Egypt’s international reserves saw a slight upward trend in October, climbing to $35.1 billion compared to September’s recorded $34.97 billion, according to a recent report by the Central Bank of Egypt (CBE).

The reserves, also known as foreign reserves, are a collective basket of items such as gold and special drawing rights (SDRs), as well as major international currencies, including US dollars, Euros, Japanese Yen, and Chinese Yuan.

The Egyptian government has upped efforts to bring in fresh injections of foreign currency and diversify its external financing sources, which includes strengthening its position with the latest issuances of foreign-denominated bonds.

Egypt launched Japanese-yen-denominated “Samurai” bonds twice this year, once in August and another in October, worth a combined $1 billion. The government also issued its inaugural Chinese-yuan-denominated “Panda” bonds worth $500 million.

The country is looking to attract $25 billion in foreign direct investments (FDIs) within the next 5 years, as it seeks to shrink a financing gap between $6-8 billion for the current fiscal year. FinMin Mohamed Maait shared that this gap could be narrowed by issuing new foreign currency-denominated bonds, and other methods.

Bolstering Egypt’s foreign reserves were recent deposits by the China Development Bank’s recent ¥7 billion ($956.61 million) to the CBE, as well as a potential injection of funds by Gulf partners KSA and the UAE.

Last week, the CBE revealed that its gold reserves dropped by 2.8% in September to EGP 235.64 billion ($7.64 billion) from EGP 242.42 billion ($7.86 billion) in August.

According to MPED minister, Hala El-Said, foreign direct investment (FDI) flows hit $10 billion in FY2022/2023, representing a 12.8% increase compared to the previous financial year.

In recent CBE news, the bank’s Monetary Policy Committee (MPC) decided to maintain key interest rates as it expects a slowed real GDP growth for FY2022/2023.