Translated by Sama Marwan,
Moody’s credit rating agency has announced that it has decided to revise Egypt’s outlook to positive, confirming its rating at CAA1.
The agency said in its statement that the change in the outlook for the Egyptian economy reflects the strong support announced and the significant steps taken in policy during the past week.
It added that the rating confirmation reflects Egypt’s high debt ratio and weak debt tolerance compared to its peers.
Two days ago, the Central Bank of Egypt decided to raise interest rates in a surprise meeting by 600 basis points, stating that it would allow the market to determine the exchange rate, resulting in the pound falling to around 52 pounds against the dollar.
Additionally, the International Monetary Fund (IMF) on Wednesday approved an increase in Egypt’s loan value to $8 billion, from $3 billion agreed upon in December 2022.
According to a press conference by the Egyptian government and IMF representatives, an agreement was reached on the expert level regarding the first and second reviews of Egypt’s program.
It is worth mentioning that the Institute of International Finance recently predicted in a report that Egypt’s total foreign exchange reserves would exceed $50 billion, enough to cover eight months of imports, by the end of the current fiscal year.
The Central Bank of Egypt revealed last Tuesday that net foreign exchange reserves had risen to $35.31 billion at the end of February, from $35.25 billion at the end of January.
