Egypt’s central bank governor highlights reforms, rising reserves at AlUla Conference

Egypt’s central bank Governor Hassan Abdalla told a Saudi conference on Monday the country’s shift to a fully flexible exchange rate and an inflation-targeting system has helped bring inflation down sharply and restore confidence in the economy.

Speaking at the second AlUla Conference for Emerging Market Economies organised by the Saudi Finance Ministry in partnership with the International Monetary Fund (IMF), Abdalla outlined the Central Bank of Egypt’s (CBE) efforts to build a resilient monetary policy framework rather than managing a fixed exchange rate.

He highlighted a series of reforms launched in March 2024, noting that inflation has fallen from around 40 percent to nearly 12 percent. The governor also emphasised the importance of building precautionary reserves during periods of economic growth, strengthening coordination among central banks, and improving tools for real-time economic forecasting to guide policy decisions.

Abdalla pointed to signs of recovery across Egypt’s economy, citing rising revenues from the Suez Canal, record tourism arrivals and spending, and stronger private-sector activity, with the Purchasing Managers’ Index (PMI) rising above 50 points, signalling expansion. He added that Egypt’s net foreign reserves reached a record $52.594 billion in January, covering more than six months of imports and 158 per cent of short-term external debt.

On the sidelines of the conference, Abdalla held meetings with international financial officials and fellow central bank governors to discuss global risks, crisis preparedness, and coordinated economic policies.

Attribution: Amwal Al Ghad English