Egypt’s external debt registers record decline in May: External debt dropped to USD 153.9 bn at the end of May, down by USD 14.2 bn — or 8.43% — from its level at the end of December 2023, according to a high-level source at the central bank.

We’ve got our imports covered for eight months: Egypt’s foreign reserves can now cover around 7.9 months of merchandise imports, “greatly exceeding internationally recognized safe levels,” the source said.

Lower yields on USD-denominated bonds and falling credit risk augur well for Egypt’s credit rating outlook and cost of borrowing in international markets, the source added, pointing to the decline in the risk accorded Egypt’s debt instruments as a sign of international markets’ confidence in the ability of the country to meet its obligations.

Also helping: There was “tremendous growth” in FX inflows, which rose 200% — remittances from Egyptians abroad more than doubled — between early March and now.

ICYMI- FX reserves hit a record high in June: Net foreign reserves increased in June to just under USD 46.4 bn, surpassing the previous peak of USD 46.1 bn recorded in May.

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