According to an anonymous source familiar with the matter speaking to Amwal Al Ghad English, the Egyptian market is bracing for a significant surge in foreign exchange inflows, expected to total around $50 billion. This influx, the largest in the past decade, is poised to bolster foreign exchange liquidity and signal a positive trend towards currency market stability.
Breakdown of the expected foreign exchange liquidity reveals contributions from various sources: $8 billion from the International Monetary Fund (IMF), $1.2 billion from the IMF Sustainability Facility, $20 billion from the remainder of the Ras El Hekma deal, $8 billion from the European Union, $6 billion from the World Bank, and an additional $6.5 billion from state asset sales throughout the year.
The source emphasized that alongside these inflows, the Egyptian central bank’s efforts to unify exchange rates and implement currency flotation measures will effectively address foreign exchange demand while curbing inflationary pressures. It is anticipated that these actions will lead to a short-term reduction in inflation rates to single digits, subsequently contributing to price stabilization.
Highlighting the broader economic implications, the source concluded by stating that this trend aligns with the government’s objective of establishing sustainable internal sources of foreign exchange in the medium to long term.
