Egypt’s net foreign assets climb by $2bln in December


Egypt’s net foreign assets climb by $2bln in December

CAIRO - Egypt's net foreign assets (NFAs) improved by 47.28 billion Egyptian pounds in December, marking a second month of increases after it allowed its currency to depreciate sharply in October, central bank data showed.

NFAs improved to a negative 494.3 billion Egyptian pounds from a negative 541.5 billion in November.

This works out to an improvement of about $2.06 billion using end-of-month central bank exchange rates, according to Reuters calculations.

Before the October depreciation, the central bank had been relying on NFAs, which represent banking system assets owed by non-residents minus liabilities, to help support the currency. NFAs include foreign assets held by the central bank.

Russia's invasion of Ukraine in February sparked a currency crisis that led to Egypt to begin negotiating with the International Monetary Fund for a financial assistance package.

The central bank allowed the pound to depreciate by 14.5% on Oct. 27 as part of a $3.0 billion rescue package it concluded with the IMF. Since then it has continued to let the currency weaken.

The pound has fallen by nearly 50% since the invasion to about 30 to the dollar after the crisis caused tourism to fall, commodity import prices to rise and foreign investors to pull more than $20

Follow the conversation