Egypt’s net foreign reserves dropped slightly in August, the central bank said Thursday, as the North African country strives to secure International Monetary Fund assistance amid the war in Ukraine that is putting pressure on the pound.
Reserves at the end of August fell to $33.142 billion from $33.143 billion in July, the Central Bank of Egypt (CBE) said in a statement. Authorities in the Arab World’s most populous nation are racing to shield the economy after the war in Ukraine sent food and energy import bills soaring prompting an exodus of foreign portfolio investors from the local debt market.
Egypt has received help from other oil-rich GCC nations who’ve pledged more than $22 billion in deposits and investments in recent months. However, only a fraction of those investments have yet been finalised. Saudi Arabia’s sovereign wealth fund launched a company to invest in promising sectors throughout Egypt including financial services, infrastructure as well as real estate and pharmaceuticals.
UAE-based companies including Al-Futtaim Group, Abu Dhabi state holding firm ADQ and ADNOC Distribution have plowed funds into Egyptian companies to help shore up the economy.
Red hot inflation
Egypt’s statistics agency said Thursday that the annual inflation in August accelerated to its fastest level since November 2018 on the back of higher food costs. The state-run Central Agency for Public Mobilization and Statistics (CAPMAS) said consumer prices soared 14.6% from a year earlier in August compared to 13.6% in July.
Food and beverage costs, which make up the largest single component of the inflation basket, jumped 23.1%. The ongoing war in Ukraine has taken inflation rates worldwide to unprecedented levels.
