Cairo – Mubasher: Egypt’s stronger net international reserves (NIR) is seen a corner stone for the International Monetary Fund agreement (IMF) and another factor emphasizing the pound’s devaluation, according to a report by Pharos Research on Tuesday.
“USD liquidity buildup and strengthening the NIR is part of the deal with the IMF, along with currency adjustment”, said the research firm.
The Central bank of Egypt announced yesterday that net foreign reserves rose to $19.591 billion by the end of September 2016 from $16.564 billion by the end of August.
This increase represents the World Bank's $1 billion first tranche of a lending facility worth $3 billion and another $2 billion deposits from the UAE, which were transferred in early September, the research agency reported.
The firm expects additional fund transfers from Saudi Arabia ($2-3 billion), China ($2 billion), in addition to the Eurobond issuance ($3-5 billion).
“These funds would potentially take the NIR position north of USD 25 billion by year end. The addition to NIR in September emphasizes exchange rate adjustment is soon, which could happen within the month of October”, the research firm concluded.
