Fitch Downgrades Egypt to B- With Stable Outlook

By Stephen Nakrosis

Fitch Ratings on Friday downgraded Egypt's Long-Term Foreign-Currency Issuer Default Rating to B- from B, with a stable outlook.

Fitch said the downgrade reflects increased risks to Egypt's external financing and macroeconomic stability, as well as the direction of the country's already-high government debt. Downward pressure on the Egyptian pound has increased, Fitch said, adding "the path to policy adjustment has become more complicated, in our view."

Other factors cited by Fitch include Egypt's proximity to the Israel-Hamas conflict and the impact of persistent high inflation.

Fitch said it based its outlook on the expectation reforms will accelerate after presidential elections in December, which could lead to "a new and potentially larger IMF program and additional support from the GCC."

In May, Fitch downgraded Egypt to B with a negative outlook.

Write to Stephen Nakrosis at [e-mail]

(END) Dow Jones Newswires

11-03-23 1746ET