EFG-Hermes: Qatari Deposit Repayment behind Egypt’s FX Reserves Fall

EFG-Hermes Holding said in a report the slump in Egypt’s foreign currency reserves in November was due to paying back the $2.5 billion Qatari deposit.

The Central Bank of Egypt (CBE) announced on Sunday that Egypt’s foreign currency reserves fell to $15.88 billion at the end of November, 2014 from $16.91 billion in October.

The Egyptian government said in late November that it repaid to Qatar a $2.5 billion central bank deposit received under former president Mohamed Morsi. It received during the same month a $1 billion grant from Kuwait.

This is the first time that the country’s forex reserves fall below $16 billion since June 2013, according to EFG-Hermes.

Foreign reserves rose at October-end to $16.909 billion from $16.872 billion the previous month.
Foreign reserves fell sharply after the 2011 uprising that ousted President Hosni Mubarak but have risen again on the back of billions of dollars of Gulf Arab aid that has flooded into Egypt since the army overthrew elected Islamist President Mohamed Morsi last year.