Ref : EG2 3 CRA00-0 1 10 March 2023
Egypt – Outlook Revised to Negative; Ratings Affirmed Rating Action
Capital Intelligence Ratings (CI Ratings or CI ) today announced that it has revised the Outlook on Egypt’s Long-Term Foreign Currency Rating (LT FCR) and Long-Term Local Currency Rating (LT LCR) to Negative from Stable. At the same time, CI Ratings has affirmed the sovereign’s LT FCR and LT LCR at ‘B +’ , and Short-Term (ST) FCR and ST LCR at ‘B’.
Rating Rationale
The change in the o utlook reflects the deterioration in the sovereign’s capacity to absorb external shocks , which has been exacerbated by negative t rade and investment spillovers from the war in Ukraine a nd by the tightening of global monetary policies. These factors have contributed to the exit of non-resident portfolio investment, declining foreign exchange reserves, and costlier access to capital markets. The o utlook also reflects CI ’s expectation…