{"id":684458,"date":"2026-03-05T00:00:00","date_gmt":"2026-03-05T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/?p=684458"},"modified":"2026-03-07T11:41:44","modified_gmt":"2026-03-07T11:41:44","slug":"usd-egp-exchange-rate-stable-following-latest-imf-disbursement","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2026\/03\/05\/usd-egp-exchange-rate-stable-following-latest-imf-disbursement\/","title":{"rendered":"USD \/ EGP exchange rate stable following latest IMF disbursement"},"content":{"rendered":"

Egypt received a USD 2.3 bn disbursement from the IMF yesterday<\/strong>, a senior government official told EnterpriseAM. We secured the fresh funds after passing the fifth and sixth reviews of the Extended Fund Facility and first review of the Resilience and Sustainability Facility.<\/p>\n

MEANWHILE- The EGP held steady yesterday at around EGP 50.14 to the greenback<\/strong> after sliding earlier in the week following the outbreak of hostilities in the Gulf. Interbank volumes were c.USD 848 mn yesterday (up about 20% from USD 700 mn the day before). Bankers told us they had no problems meeting market demand yesterday.<\/p>\n

Where the IMF\u2019s money is going: <\/strong>The CBE will hang on to the greenbacks and give the Finance Ministry the equivalent of about USD 2 bn to support the budget and help plug the financing gap, we\u2019re told. The remaining USD 297 mn will be earmarked to back climate and environmental sustainability projects.<\/p>\n

That\u2019s not all: <\/strong>\u201cIt\u2019s possible that the funds arrived and were paid out immediately to settle debts, instead of supporting the exchange rate,\u201d Al Ahly Pharos\u2019 Hany Genena tells us, adding that up to this point, there have been no indications of speculation or unusual market activity.<\/p>\n

Despite the timely buffer, hot money continued to leave the country. <\/strong>Portfolio investors have pulled about USD 2 bn out of Egypt since war broke out this past weekend, a senior banker tells us. The banker characterized outflows as \u201cwithin safe limits\u201d and said that investors should have \u201ccontinued confidence in the economy\u201d given the central bank\u2019s handling of the crisis so far.<\/p>\n

One banker we spoke with is worried that the combination of rising oil prices and <\/strong>shipping costs <\/strong>could soon weigh heavily on the EGP, but EG Bank board member Mohamed Abdel Aal sees the EGP settling around EGP 50 unless the war gets much worse. There\u2019s room for the EGP to strengthen to EGP 46-48 against the greenback as things stand, but if the conflict expands and tourism and Suez Canal revenues *both* vaporize? Then all bets are off, he suggests.<\/p>\n

War clouds budget targets<\/p>\n

The Finance Ministry is watching like the rest of us, wondering what to do with next <\/strong>year\u2019s budget. <\/strong>Officials are running scenarios for growth, investment, government spending, private sector investment, and the cost of purchasing goods and services, a senior government source told EnterpriseAM. The review will also account for the rising cost of debt service as the state shifts toward domestic financing and a reassessment of commercial external borrowing costs, particularly as investors demand more of Egypt in a risk-off scenario.<\/p>\n

Higher oil prices and a weaker EGP could force the Madbouly government to boost <\/strong>spending on subsidies and the social safety net<\/strong> as well as the purchase of goods and services, our government source told us. The overall budget deficit could widen to 6-7%, up from an initial target of 4.9%, the source said.<\/p>\n

Emergency fiscal measures<\/p>\n

The Finance Ministry has about EGP 140 bn in a contingency fund ringfenced in this <\/strong>year\u2019s budget<\/strong>, another source tells us, but could look to set aside more if the war stretches out.<\/p>\n

Officials may need to face down an uptick in inflation: <\/strong>A 10% increase in energy prices in 2Q or 3Q would add 1 percentage point to non-food inflation, according to a report by Morgan Stanley seen by EnterpriseAM. That could put pressure on the CBE to leave interest rates on hold next month, stalling the much-anticipated easing cycle.<\/p>\n

Officials signaled yesterday they\u2019ll once again use the customs gate as a <\/strong>risk-management tool:<\/strong><\/p>\n