12.8 C
New York
Friday, May 20, 2022

Egypt’s Sovereign Rating Raised by S&P on Economic Revival

Egypt's Sovereign Rating Raised by S&P on Economic Revival© Reuters. Egypt’s Sovereign Rating Raised by S&P on Economic Revival

(Bloomberg) — Egypt’s credit-rating was upgraded one notch by S&P Global Ratings, which cited strengthening economic growth and rising external foreign exchange reserves.

The country’s long-term rating was lifted to B, or five levels below investment grade, from B-, S&P said in a statement Friday. The outlook on the rating is stable.

The revision reflects broader confidence in the changes taking place in the Arab world’s most populous nation since the November 2016 decision to float the currency. That move, while halving the pound’s value against the U.S. dollar and sending inflation soaring, also helped secure a $12 billion International Monetary Fund lifeline and attract foreign investors.

“The liberalization of the currency regime on Nov. 3, 2016 has reduced external imbalances and boosted remittances and portfolio inflows, leading to higher foreign reserves,” S&P said in the report. “Inflation has started to moderate, partly because of base effects but also reflecting the increasing effectiveness of the monetary framework.”

Egyptian officials have touted the progress they’re making in reviving an economy battered in the wake of the 2011 uprising that ousted President Hosni Mubarak. The lifting of currency controls in 2016, accompanied by a cut in fuel subsidies, was lauded by the IMF and international investors who, in turn, have pumped in more than $19 billion into the domestic debt market.

The economic growth rate in the first half of the current fiscal year climbed to 5.2 percent compared to 3.6 percent a year earlier, according to the planning minister. The IMF is projecting GDP growth of 4.8 percent this fiscal year from 4.2 percent. The fund also expects officials to adopt more expansionary monetary policy and cut interest rates as annual inflation that hit a record of over 33 percent last year slows.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source: Investing.com

Related Articles

Stay Connected

11,298FansLike
12,893FollowersFollow
751FollowersFollow
- Advertisement -

Latest Articles

Popular Articles