Egypt’s Stocks Rise to Two-Month Highs Following Saudi Cash Deposit

Egypt’s Stocks Rise to Two-Month Highs Following Saudi Cash Deposit

REUTERS/Mohamed Abd El Ghany
REUTERS/Mohamed Abd El Ghany

Egypt’s stocks reached a two-month high after receiving a cash deposit from Saudi Arabia, driving speculation that the country is about to devalue its currency, Bloomberg news agency reported.

The benchmark EGX 30 index rose by 3.9 percent by the end of the day, to reach 8505.12 points, in odds with the decline of most emerging markets worldwide.

“The news overnight about the Saudi deposit is prompting investors to speculate that the devaluation is imminent,” Sherif Shebl, an equities trader at Pharos Holding for Financial Investments in Cairo, told Bloomberg.

According to Aswat Masriya, Egypt received a USD 2 billion deposit from Saudi Arabia on Wednesday. The deposit is part of the USD 6 billion Egypt is required to secure from bilateral creditors in order to finalize a USD 12 billion loan from the International Monetary Fund (IMF).

The value of the Egyptian pound has reached record lows of 15.58 against the dollar, according to Bloomberg and Reuters, marking a total loss of 17 percent this month.

n August, Egypt reached a preliminary agreement with the IMF to receive a three-year Extended Facility Fund, which will be used to support the government’s ambitious reform program aiming to reduce the country’s budget deficit.

Chris Jarvis, who is heading the IMF’s mission to Cairo, said at the time that the government’s fiscal policy will aim to reduce public debt to more sustainable levels.

“Over the program period general government debt is expected to decline from about 98% in 15/16 to about 88% of GDP in 2018/19. The aim is to raise revenue and rationalize spending, to reduce the deficit and to free up public funds for high-priority spending, such as infrastructure, health and education, and social protection,” said Jarvis.

“With the implementation of the government reform program, together with the help of Egypt’s friends, the Egyptian economy will return to its full potential,” said Jarvis, adding that the IMF will encourage multilateral agencies and countries across the world to support Egypt during this stage.

At the end of September, Egypt’s foreign reserves rose to USD 19.592 billion, up from USD 16.564 billion the previous month.

12 Egyptian Soldiers Killed in Attack in Sinai
Saudi Arabia 'Recalls' Ambassador to Egypt?

Subscribe to our newsletter


More in News


Egypt Court Upholds Former President Morsi’s 20-Year Prison Sentence

Aswat MasriyaOctober 23, 2016
Egyptian President, Abdel Fattah El-Sisi arrives at Air Force station in New Delhi on September 1, 2016 AFP / PRAKASH SINGH

Egyptian President Sisi’s Approval Ratings Fall to 68%: Baseera

Egyptian StreetsOctober 23, 2016

Egypt’s President Sisi Calls for ‘Maximum Vigilance’ After Brigadier General Killed in Cairo

Egyptian StreetsOctober 23, 2016

Egypt Court Releases Mother of Suez FGM Victim, Postpones Trial to November

Egyptian StreetsOctober 20, 2016
John Kerry

US Shifts Over $100 Million of Aid Away From Egypt

Egyptian StreetsOctober 20, 2016

Egypt’s Mediation Efforts Secure Evacuations, Delivery of Humanitarian Aid, Says Foreign Ministry

Egyptian StreetsOctober 20, 2016
A worker sells subsidized food commodities at a government-run supermarket in Cairo, Egypt, Feb.14, 2016 (Photo: Reuters)

Egypt to Consider Boosting Subsidies to Shield Low-Income Citizens from Hardships of Economic Reform

Egyptian StreetsOctober 19, 2016
An Egyptian supporter waves a national flag during the World Cup qualifying playoff second leg soccer match, at the Air Defense Stadium in Cairo, Egypt, Tuesday, Nov. 19, 2013 (Photo: AP)

Egypt to Reopen Stadiums to Soccer Fans for World Cup Qualifier

Egyptian StreetsOctober 19, 2016
Egyptian Streets is an independent, young, and grass roots news media organization aimed at providing readers with an alternate depiction of events that occur on Egyptian and Middle Eastern streets, and to establish an engaging social platform for readers to discover and discuss the various issues that impact the region.

© 2016 ES Media UG. All Rights Reserved.