Egypt's Net Foreign Assets Saw a Significant Jump in January, Supported by Bond Sales
Egypt's net foreign assets saw a significant increase of $2.74 billion in January, supported by the sale of $2 billion worth of dollar-denominated international bonds, according to data from the Central Bank of Egypt.
According to calculations by Reuters based on the official exchange rates from the Central Bank, net foreign assets rose to $8.70 billion at the end of January, compared to $5.96 billion in December. This growth marks the first increase after three months of decline in late last year.
This improvement came after Egypt completed its first dollar-denominated international bond issuance in four years on January 29, providing new liquidity that bolstered foreign exchange reserves.
Net foreign assets include balances from the central bank and commercial banks, which Egypt has been using since September 2021 to support the stability of the local currency. After net foreign assets turned negative in February 2022, they only returned to positive levels in May 2023.
Analysts and bankers noted that Egypt made significant dollar payments in December, due to the maturity of Egyptian pound treasury bills held by foreign investors, in addition to a $1 billion payment to the International Monetary Fund and payments for natural gas imports.
Despite the increase in foreign assets in January at the central bank and commercial banks, their external liabilities also rose in parallel, reflecting the continued challenges in managing the balance of payments amid global economic changes.
