Egypt's foreign currency reserves inch up to $18.91 bn in August

Ahram Online, Thursday 5 Sep 2013

Foreign currency reserves continue to rise in August on the back of Gulf assistance received after Morsi ouster

U.S. dollars
An Egyptian man stands next to a giant poster of U.S. dollars inside a currency exchange office in Cairo (Photo: AP)

Egypt's foreign currency reserves inched up by $34 million in August to reach $18.91 billion, the Central Bank of Egypt (CBE) announced on Thursday.

The country's reserves had leapt by nearly $4 billion to reach $18.88 billion in July, their highest level since November 2011, as Saudi Arabia, the United Arab Emirates, and Kuwait showered Egypt with financial aid immediately following the ouster of Islamist President Mohamed Morsi.

The oil-rich Gulf nations pledged a combined $12 billion in assistance, of which cash-strapped Egypt received $5 billion.

Egypt's foreign currency reserves, which stood at $36 billion in January 2011, have been declining as the CBE used them to prop up the local currency following a revolution which toppled the regime of Hosni Mubarak in February of that year.

The United Arab Emirates pledged an additional $2 billion in aid, in deposits and grants, to Egypt on Monday during a visit to Cairo by Abu Dhabi's crown prince.

The Egyptian pound strengthened by 12 percent against the dollar on Wednesday at a forex auction, in which the CBE offered an unprecedented $1.3 billion, in a move which reflected a level of comfort with the resilience of the reserves from political and economic shocks.

The CBE started auctioning foreign currency in December of last year in attempt to salvage its dwindling reserves, which had sunk to a critical $15.04 billion in November, enough to cover only three months of the country's vital imports.

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