CBE: Egypt's Net Foreign Reserves Rise above $40 Billion

The Central Bank of Egypt (CBE) said on Tuesday that net foreign reserves rose to $40.063 billion in December from $39.222 billion a month earlier.

In light of the economic repercussions of the coronavirus outbreak, foreign reserves have been falling since March from a high of more than $45 billion.

The balance of payments for the fiscal year 2019/20 recorded a deficit of $8.6 billion, which was recorded mainly in the second half of the year. In 2020, CBE said that the balance of payments deficit in the second half alone amounted to $9 billion due to the impact of the corona pandemic on the economy.

The current account deficit registered $11.2 billion, compared to a deficit of $10.9 billion in FY of 2018/19 due to the decline in services and investments in Egypt.

Egypt imports an average of $5 billion a month of goods from abroad, with an annual total of more than $55 billion. Consequently, the current average foreign exchange reserves cover about 8 months of commodity imports to Egypt.

The foreign reserves in Egypt are usually made up of a basket of the main currencies, namely the US dollar, the single European currency "euro", the British pound, the Japanese yen and the Chinese yuan. The percentage of Egypt's foreign reserves are distributed on the basis of the exchange rates of those currencies and their stability in international markets.