Egyptian pound set for steadier path, GDP to grow 5.5% by FY2026

CAIRO – 4 November 2025:  Mohamed Gad, Chief Executive Officer and Managing Director of Standard Chartered Bank Egypt, expects the Egyptian pound to move on a more stable and improving path in the coming period. He attributed this outlook to steady external conditions and resilient foreign-currency inflows.

Speaking to Al Arabiya Business, Gad noted that several factors are driving this positive trend—most notably, the gradual easing of inflation, the Central Bank of Egypt’s shift toward a more flexible monetary policy, and improvements in the current account balance, coupled with sustained foreign investment inflows.

According to data from the Central Bank of Egypt, the U.S. dollar has depreciated by roughly 2.76 percent against the Egyptian pound over the past two months, dropping to LE 47.28 for sale by the end of October, compared to LE 48.62 at the beginning of September.

Earlier forecasts from the bank were more conservative, expecting an exchange rate of between LE 52 and LE 54 per dollar in 2026.

Gad added that ongoing improvements in key economic indicators could strengthen Egypt’s medium-term credit outlook, especially as the country anticipates an additional $2.5 billion tranche from the International Monetary Fund before year-end.

He also pointed to the government’s structural reforms as a cornerstone for stronger macroeconomic performance ahead.

He projected that inflation will temporarily rise toward the end of 2025, ranging between 13 percent and 17 percent, before easing to about 11 percent by the end of 2026, despite continued pressure in sectors such as food, healthcare, and transport.

On monetary policy, Gad said the Central Bank will likely adopt a cautious approach to interest-rate cuts, forecasting the key rate to settle near 19.25 percent by the end of 2025. The aim, he explained, is to maintain attractive yields that reinforce confidence in the local currency.

“We are optimistic that the coming phase will witness stable prices and gradually lower rates, creating a more appealing investment environment for both private and foreign investors,” Gad stated.

He emphasized that lowering interest rates would not harm the attractiveness of investment in government debt instruments, as the “carry trade” remains appealing amid macroeconomic stability and smooth currency conversion.

Standard Chartered expects Egypt’s GDP growth to reach 5.5 percent in the 2026 fiscal year, supported primarily by private-sector expansion.

Since launching operations in Egypt two years ago, the bank has attracted nearly $200 million in investments across eight clients in construction, telecommunications, and media. An additional $50 million has been directed to renewable energy and consumer goods projects, with capital inflows coming from the MENA region and Pakistan.

Gad highlighted the bank’s role in providing advisory and financing solutions to facilitate international investors’ entry into the Egyptian market while supporting government initiatives to strengthen the investment climate.

“Our current focus is on financing major projects, collaborating with export credit agencies, and delivering structured export-finance solutions in partnership with international and development banks,” he said.

He added that the bank’s main beneficiaries include infrastructure, energy, and utilities sectors, as well as multinational firms operating in Egypt.

Gad concluded that Standard Chartered Egypt continues to serve four core client groups—private-sector companies, government-related entities, financial institutions, and global corporations—aiming to generate real value and contribute to Egypt’s sustainable economic growth.