2024-03-09 01:00:00 ET
Summary
- The US dollar-Egyptian pound exchange rate has been devalued by 38%.
- The Egyptian equity market, as represented by the EGX 30 index, has risen by 68% in local currency terms and is essentially flat in US dollar terms since September 2023.
- Egypt’s difficult financial adjustment, along with a pledge of structural reform under the IMF program, is likely to increase domestic confidence and boost investment.
Egypt has made the adjustment investors were waiting for. The US dollar ((USD))-Egyptian pound ((EGP)) exchange rate has been devalued by 38%, and the government has agreed to an increase in its loan program with the International Monetary Fund (IMF) to US$8 billion. 1 It also recently agreed to make a long-term investment with the United Arab Emirates ((UAE)), which will pay US$35 billion for property development rights on Egypt's Mediterranean coast. 2 We adopt a neutral stance toward Egyptian equities for now....
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Egypt: Bold Moves