Goldman Sachs has forecast that the Egyptian pound will rise against the US dollar by early 2025, driven by a decline in the wave of “hot money” resulting from seasonal factors. The pound, which recently hit a record low of 50.90 per dollar, is expected to benefit from anticipated reform measures. According to Farouk Sosa, the chief economist at Goldman Sachs, these reforms are expected to improve Egypt’s economic outlook.
Economic Support and Financial Moves
Interest Rate Cuts and Long-term Bonds
Sosa explained that the anticipated decrease in interest rates would prompt the Ministry of Finance to issue long-term bonds. This strategy aims to attract investors back to Egypt’s local market. These financial dynamics coincide with Egypt’s efforts to stabilize monetary policies and avoid budget deficits, with expectations for currency stability driven by supply and demand adjustments.
Stable Currency Outlook
With fiscal and monetary measures in place, experts predict that Egypt’s currency will find stability. The government’s actions are aligned with an attempt to balance the national budget while boosting investor confidence.
Attractive Investment Strategy
HSBC’s Positive Outlook for Egypt
HSBC’s latest report positions Egypt as one of the most attractive markets in the region, with high interest rates providing an incentive for investors despite the external deficit challenges. The country’s growing foreign reserves further enhance investor confidence, alongside facilities from the International Monetary Fund (IMF). The IMF is expected to release a new installment of $1.3 billion, as confirmed by the Prime Minister.