Egypt’s foreign reserves rise by $110m in May

Egypt’s foreign reserves increased by about $110 million in May to $34.66 billion from $34.55 billion in April, the latest data from the Central Bank of Egypt showed. Egypt’s net international reserves in March, February and January stood at $34.44 billion, $34.45 billion and $34.2 billion, respectively.

After the economic breakdown following the Ukraine-Russia war, Egypt’s NIR dropped from a high of $40.9 billion in February 2022 to a record low of $33.14 billion in August 2022.

However, the North African country’s NIR has gradually inclined in the past nine months. According to the central bank, Egypt’s international reserves comprised approximately $26.7 billion in foreign currencies, $7.95 billion in gold and $27 million in special drawing rights.

The International Monetary Fund defines the SDR as an international reserve asset created to supplement the official reserves of its member countries.

The IMF is currently assessing Egypt’s economic environment to release the second installment of a $3 billion loan approved in December 2022. According to data announced by the central bank in May, Egypt’s net foreign assets deficit increased by $1.66 billion to $24.42 billion in March 2023 from 22.76 billion in February.

Egypt’s current account deficit also dropped 77.2 percent to $1.8 billion in the first half of its fiscal year.

The financial institution revealed this deficit reduction was fueled by Egypt’s current account turning a $1.41 billion surplus in the October to December quarter of 2022 as imports dropped and exports rose. This shift came after the country saw a $3.19 billion deficit between July and September — the first quarter of Egypt’s fiscal year. During most of 2022, import restrictions were in place to tackle the North African country’s current account shortfall.