Egypt’s net international reserves dropped slightly to US$33.142bn in August from US$33.143bn in July.
While the decline was marginal, net international reserves are at the lowest level since June 2017 and have fallen four straight months, suggesting there is yet to be a reprieve from the economic fallout from the war in Ukraine. While Gulf nations have pledged more than US$22bn in deposits and investments to help Egypt deal with the shockwaves of the war in Ukraine, only a fraction of these investments have been finalised.
Egypt’s net international reserves are in the spotlight amid speculation about how it will deal with its external funding gap and debt commitments. With reserves continuing to fall and Egypt set to require more funds for imports and debt payments in the coming months, pressure is mounting for another currency devaluation to address some of the macroeconomic imbalances that have left the country extremely vulnerable.