The disappointment of the weekend: Moody’s left Egypt’s credit rating unchanged at B3 even as the research houses (including Pharos Holding and Goldman Sachs) suggested there was room for an upgrade to B2. “Very weak government finances will continue to constrain the rating pending further clarity on the sustainability and impact of the reform programme,” the agency said on Friday. While it did acknowledge that Egypt's external liquidity position has significantly improved over the past 12 months, “the increase in international reserves has been mainly driven by debt-creating inflows, thus also raising the level of external debt and FX denominated debt.” Fears of political instability in the run up to the May 2018 presidential elections was an apparent factor in the decision.

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