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IMF says Egypt to get $2.75 bln on Friday if board approves bailout
The International Monetary Fund said that it will disburse an initial $2.75 million loan tranche to Egypt on Friday assuming that the Fund’s board votes to approve the $12 billion bailout program.
IMF spokesman Gerry Rice told a regular news briefing that the board vote on Friday comes as China, the United Arab Emirates, G7 countries have contributed towards supplemental bilateral financing of up to $6 billion needed for the Egypt program. Rice added that some of that financing also will come from commercial bank financing and a proposed euro bond issue.
Egypt Bourse gains 90.7b EGP in week
The Egyptian Exchange (EGX) closed this week with gains amounting to 90.7 billion EGP after the central bank float the Egyptian pound against the US dollar, Youm7 reported.
Over the course of the week ended Thursday, the main benchmark index EGX30 added 21.31 percent to close at 10,688.16 points, while the small and medium caps index EGX70 added 15.05 percent to close at 403.51 points.
The capital market gained about 18.7 billion EGP to reach 519.4 billion EGP with transactions surpassed 2.25 billion EGP.
Egypt’s core inflation jumps, consumer inflation eases for second month
(Reuters) – Egypt’s core inflation jumped but urban consumer price inflation eased for the second consecutive month in October, the central bank said, a week after it floated the pound and the government hiked interest rates and fuel prices.
October’s decline in urban consumer price inflation was the second since inflation figures hit a near eight-year high of 15.5 percent in August. Core inflation, which strips out the price of volatile items such as fruit and vegetables, rose from 13.93 percent to 15.72 percent.
Prices have been rising in Egypt as the country embarks on economic reforms and seeks to secure a $12 billion International Monetary Fund loan programme.
Last week, the central bank floated the pound and hiked interest rates by 300 basis points. It also raised fuel prices.
The government’s reform programme, on the basis of which it applied for the IMF loan, also includes the introduction of a value-added tax which came into effect in September.
“The core inflation figures better reflect inflationary pressures emanating from the VAT and higher FX rates,” Reham ElDesoki, senior economist at Arqaam Capital, said in a note.
President Abdel Fattah al-Sisi is under rising pressure to revive the economy and curb inflation that has affected living standards to avoid a public backlash.
The pound depreciated to 16.4 in the first week of trading from the central bank’s peg of 8.8 per U.S. dollar a week before the flotation.
Egypt expects to receive the first $2.75 billion instalment from the IMF as early as next week, bringing fresh dollar inflows into the economy.