Egypt – JP Morgan expects an increase of $16.2 billion in Egypt’s foreign exchange (FX) reserves in the coming fiscal year (FY) 2024/2025 and $2.6 billion in FY 2025/2026, according to a report by the American multinational financial services firm.
The banks also forecasts the country’s current account deficit to widen to $15.2 billion, or 4% of gross domestic product (GDP), this year.
Furthermore, it projects $8.1 billion of net foreign portfolio investment flows, which may be considered conservative in light of the large net inflows into the domestic market, according to the report.
In addition, interest expenditures are forecasted to rise to 9.7% of GDP in FY 2024/2025 and 11% in FY 2025/2026, while accounting for around 70% of revenues.
However, the US-based financial services provider expects that the country’s public debt to GDP to drop to 85% in FY 2025/2026 due to higher nominal growth and a larger primary surplus
The bank also anticipates Egypt’s economic growth to rebound to 4.3% in FY 2025/2026 from its estimate of 2.8% in FY 2023/2024.
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