Foreign currency- Reuters
CAIRO - 3 March 2022: Egypt’s net foreign reserves decreased for the first time in 22 months, the Central Bank of Egypt (CBE) announced Thursday.
The net foreign currency reserves declined by $3.91 billion to $37.082 billion by the end of March 2022, compared to $40.99 billion recorded in February 2022.
The CBE elaborated that, in compliance with the role of the Central Bank of Egypt in maintaining the stability of the Egyptian markets, and in light of the turbulent global economic conditions due to the Russian-Ukrainian crisis, the CBE, during the month of March 2022, used part of the foreign exchange reserves to cover the Egyptian market’s foreign exchange needs and cover the exit of foreign investments and international portfolios, as well as to ensure the import of strategic goods, in addition to the payment of international obligations related to the country’s external debt.
The Central Bank stressed that despite the decrease in the reserve that occurred during the month of March, it is still able to cover more than 5 months of merchandise imports, exceeding international indicators of the adequacy of reserves.
“In light of the current developments, the Central Bank confirms that it will continue to closely monitor and assess the global situation to take the necessary measures to face any repercussions that may occur in the future,” the CBE affirmed.
Foreign currencies in Egypt’s foreign reserves include the U.S. dollar, euro, Australian dollar, Japanese yen and Chinese yuan.
The main function of the foreign exchange reserve, including its gold and various international currencies, is to provide commodities, repay the installments on interest rates of external debt, and to cope with economic crises.
Egypt's foreign exchange reserves jumped from $31.3 billion during the 2016-2017 fiscal year to about $44.3 billion during the 2017-2018 fiscal year, then continued to rise during the 2018-2019 fiscal year to reach $44.5 billion, before it retreated in light of the coronavirus crisis and its repercussions.