Monday’s hot money exit has no effect on forex reserves: Egyptian PM

CAIRO, Aug. 8 (Xinhua) — The hot money that left Egypt on Monday was not provided from the foreign exchange reserves at the Central Bank of Egypt (CBE), said Egyptian Prime Minister Mostafa Madbouly in a weekly press conference on Thursday.
The amount of hot money that left Egypt on Monday was less than 7-8 percent of the total, and the government provided it from the available foreign cash in the market, not the CBE forex reserves, the Egyptian prime minister told reporters in the press conference held in the coastal New Alamein City north of Egypt.
Madbouly’s remarks came a couple of days after foreign investors sold their Egyptian pound treasury bills in U.S. dollars and left the Egyptian market due to concerns over regional tensions.
“The most important thing is that it is completely away from the main sources of the Egyptian forex reserves,” he added, noting that the development was “a very normal movement in the market.”
Madbouly explained that all exchange markets across the world suffered losses on the same day, pointing out that recent reports of a possible U.S. economic recession affected all the world’s markets.
The foreign currency reserves at the CBE have recently increased by 105 million U.S. dollars to reach 46.5 billion dollars, the Egyptian prime minister pointed out.
Over the past few years, Egypt has been suffering from a shortage of foreign currency needed for imports, which led to the devaluation of the local currency that caused high inflation that reached a record 38 percent in September 2023 before it started to gradually decline to 25.2 percent in July 2024.
Madbouly said that his government targets reducing the inflation rate to less than 10 percent by the end of 2025 and the beginning of 2026. ■