High­est level of FX re­serves in his­tory reached by end of Oc­to­ber

CBE: $86m in­crease in value of gold, for­eign cur­ren­cies bal­ance down by $36m

The Daily News Egypt - - Front Page - By Hos­sam Mounir

The net bal­ance of for­eign ex­change (FX) re­serves at the Cen­tral Bank of Egypt (CBE) in­creased by 42% at the end of Oc­to­ber 2018, up from $44.459bn in Septem­ber 2018, to reach $44.501bn, ac­cord­ing to the CBE.

This is the high­est level of FX re­serves in his­tory, cov­er­ing 8.5 months of ba­sic com­modi­ties im­ports.

Ac­cord­ing to the CBE, the value of gold listed on the FX ex­change in­creased by $86m in Oc­to­ber 2018, up from $2.545bn at the end of Septem­ber, to reach $2.631bn, which had a great im­pact on in­creas­ing re­serves in Oc­to­ber.

In con­trast, the vol­ume of for­eign cur­ren­cies in­cluded in the re­serves de­clined by $36m, from $41.253bn in Septem­ber down to $41.217bn.

The value of spe­cial draw­ing rights de­clined by $8m, from $643m in Septem­ber to $651m, while loans to IMF reg­is­tered $14m.

The de­ci­sion to lib­er­alise the ex­change rate, which was taken by the CBE on 3 Novem­ber 2016, con­trib­uted to in­creas­ing FX re­serves by $25bn in the first two years. Up from $19.5bn in Oc­to­ber 2016, FX re­serves hiked to $45.501bn at the end of Oc­to­ber 2018.The in­crease was par­tially driven by hard cash in­flows and loans from abroad.

One of the main fac­tors con­tribut­ing to the in­crease in re­serves was the rising re­mit­tances of Egyp­tians work­ing abroad from $17bn be­fore the de­ci­sion to lib­er­alise the pound which in­creased the re­serves to $26.5bn in the fis­cal year 2017/18.

Up from $19.5bn in Oc­to­ber 2016, FX re­serves hiked to $45.501bn at the end of Oc­to­ber 2018

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