(MENAFN) JP Morgan, a prominent financial institution, has projected a substantial rise in Egypt's foreign exchange reserves for the upcoming fiscal years. According to the bank's forecasts, Egypt's reserves are anticipated to surge by USD16.2 billion in the fiscal year 2024-2025. Moreover, JP Morgan predicts a further increase of USD2.6 billion in reserves for the subsequent fiscal year, 2025-2026. These projections underscore a positive outlook for Egypt's economic stability and resilience.
The announcement from JP Morgan comes in the wake of encouraging developments in Egypt's financial landscape. In April, the Central Bank of Egypt revealed that net foreign exchange reserves had climbed to approximately USD40.36 billion by the end of March. This uptick in reserves reflects ongoing efforts to bolster Egypt's financial buffers and enhance its ability to withstand external shocks.
Despite the positive trajectory in foreign exchange reserves, data from the Central Bank highlighted a contraction in Egypt's net foreign assets deficit. This deficit narrowed by 217.1 billion Egyptian pounds (USD7.04 billion) to 679 billion pounds (USD14.25 billion) in February. This reduction can be attributed to a USD5 billion payment linked to the Ras al-Hikma deal, signaling Egypt's commitment to fulfilling financial obligations while maintaining prudent fiscal management.
In addition to the expected increase in foreign exchange reserves, JP Morgan foresees significant inflows of net foreign portfolio investment, amounting to USD8.1 billion. This influx of investment underscores growing investor confidence in Egypt's economic prospects and investment opportunities.
Overall, JP Morgan's optimistic projections for Egypt's foreign exchange reserves and foreign investment inflows signal positive momentum for the country's economy. These forecasts align with ongoing efforts to strengthen Egypt's financial resilience and foster sustainable economic growth.
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