Egypt's growth rate was 5 per cent in the third quarter of fiscal 2025/26. During regional tension, foreign holdings of local-currency government debt fell from 39.1 billion dollars to 22.2 billion dollars and the pound depreciated by 14-17 per cent. Portfolio inflows later returned, while large financing needs persisted.
Egypt's economy grew 5 per cent in the third quarter of fiscal 2025/26. The IMF and The Edge report that growth held during regional tension marked by a large portfolio outflow and currency depreciation. Tourism remained resilient, remittances reached record highs and Suez Canal activity gradually recovered after temporary disruption.[1], [2]
Foreign holdings of local-currency government debt fell from 39.1 billion dollars in February to 22.2 billion dollars in early April. The 16.9 billion dollar decline amounted to 43.2 per cent of the starting level. The Egyptian pound depreciated by about 14-17 per cent over the same period. Foreign-financing volatility in the local debt market became pronounced even as growth held.[1], [2]
Pressure later eased; portfolio inflows resumed, foreign local-debt holdings moved back near their pre-conflict level and the Egyptian pound recovered much of its initial loss. The government also issued a 1 billion euro social bond and a 500 million dollar Samurai bond. The country's large financing need persists; fiscal and debt burdens keep the economy sensitive to another external shock.[1], [2]
