Egypt: Egypt’s net foreign reserves record $35.5B in May

Egypt’s net foreign reserves decreased $1.63 billion during May, the Central Bank of Egypt (CBE) announced Monday.

The net foreign currency reserves reached  $35.5 billion by the end of April 2022, compared to $37.123 billion recorded in April 2022.

The CBE attributed this decline to the role entrusted to the Central Bank of Egypt to pay the payments related to Egypt’s foreign debts due last May, which amounted to $2 billion on behalf of the Ministry of Finance to pay treasury bonds and dues of the International Monetary Fund (IMF) and other obligations.

  The bank said that these dues and uses of foreign exchange with the Central Bank are in an expected and usual race, and the Central Bank stated that the net cash reserve balance is sufficient and covers 5 months of commodity imports.

Foreign currencies in Egypt’s foreign reserves include the U.S. dollar, euro, Australian dollar, Japanese yen and Chinese yuan.

 The main function of the foreign exchange reserve, including its gold and various international currencies, is to provide commodities, repay the installments on interest rates of external debt, and to cope with economic crises.

Egypt’s foreign exchange reserves jumped from $31.3 billion during the 2016-2017 fiscal year to about $44.3 billion during the 2017-2018 fiscal year, then continued to rise during the 2018-2019 fiscal year to reach $44.5 billion, before it retreated in light of the coronavirus crisis and its repercussions.