Citigroup Inc is ruling out the possibility of the Central Bank of Egypt (CBE) going for a deep devaluation in the Egyptian pound in the short-term; at least until the end of June, Bloomberg reported on May 11th.

Another sharp devaluation of the pound before the end of fiscal year (FY) 2022/2023 could hinder the government’s target to achieve a 6.5% budget deficit of gross domestic product (GDP) as well as stabilization of the country’s debt-to-GDP ratio, Citigroup’s London-based Head of CEEMEA strategy Luis Costa highlighted.

Costa also added that the CBE would probably wait for “bumper tourism” revenues worth $14 billion to move through the country’s economy prior to considering another pound calibration, he added.

“The CBE will likely not engineer another aggressive pound devaluation over the next month or so,” Costa wrote in a note on May 11th.

In January, Citibank expected that the Egyptian currency devaluation process nears its end, heading towards more flexibility.

 

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