An employee counts U.S. dollars in a foreign exchange office in central Cairo, Egypt. AFP
In its annual Global Focus outlook, the research arm of Standard Chartered said Egypt stands out amid a shifting global landscape, where most economies are transitioning away from monetary easing and toward a greater reliance on fiscal policy and investment-led growth.
Against this backdrop, stabilization efforts and policy reforms in Egypt, coupled with improving investor sentiment, are shaping a more constructive outlook for the year ahead.
SC Global Research expects the policy adjustment cycle Egypt has undergone over the past two years to translate into clearer signs of stabilization and recovery, particularly on the external and monetary fronts.
Continued inflows from GCC partners and long-term investors, alongside proceeds from the government's privatization programme, have helped rebuild net foreign assets and reinforce confidence.
This, in turn, has supported a more orderly foreign-exchange environment, with the research house forecasting the dollar to trade at EGP 47.5 by the end of the first quarter of 2026 and around EGP 49 by the end of the year, both revised stronger than earlier estimates.
The report also points to a sharp disinflation trend, as easing global price pressures, moderating commodity costs, and improved domestic supply conditions take effect.
Inflation is projected to fall to around 11 percent by June 2026, which is expected to give the Central Bank of Egypt room for further monetary-policy easing, helping to support business sentiment and ease financing pressures on companies.
On growth, Egypt's real GDP is forecast to rise to 4.5 percent in FY2025/2026, driven by stronger activity in trade, manufacturing, and hydrocarbons.
Tourism inflows and stable Suez Canal revenues are also expected to support the recovery as regional logistical disruptions ease and confidence gradually returns.
Mohammed Gad, CEO and head of coverage at Standard Chartered Egypt, said Egypt is entering 2026 with a much stronger macroeconomic foundation, citing resilient FX inflows, ongoing structural reforms, and an improving investment climate as key stabilizing factors.
He added that easing inflation and stronger external balances are expected to further boost private-sector confidence and unlock new opportunities for growth and long-term investment.
The outlook is further underpinned by expectations of a $2.5 billion disbursement under the International Monetary Fund's (IMF) Extended Fund Facility in early 2026, which is set to bolster foreign-exchange reserves and maintain momentum in Egypt’s reform programme.
In December, after long discussions, the IMF announced that it had reached a staff-level agreement with Egypt on the fifth and sixth reviews of the $8 billion EFF loan programme and the first review under the newly approved $1.3 billion Resilience and Sustainability Facility (RSF) deal. The completion of the three reviews is now pending the approval of the IMF’s Executive Board.
Globally, SC Global Research expects growth to remain steady at 3.4 percent in 2026, unchanged from 2025, noting that headline resilience masks important shifts in the drivers of expansion, with investment increasingly replacing external demand as monetary easing cycles draw to a close.
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