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RIYADH: Remittances from Egyptians working abroad rose by more than 77 percent in the first 10 months of the 2024-25 fiscal year, reaching a record $29.4 billion.

Between January and April alone, remittance inflows rose 72.3 percent year on year to $12.4 billion, official data from Egypt’s central bank showed.

The sharp increase underscores growing confidence among expatriates in the country’s financial system and reflects a broader improvement in Egypt’s external financial position.

The Central Bank of Egypt attributed the surge to recent measures aimed at stabilizing the exchange rate and encouraging the use of formal remittance channels.

The impact of these policies is also evident in the rise of Egypt’s net international reserves, which climbed to $48.5 billion at the end of May, up from $47.8 billion in March.

In a statement, the central bank noted: “On a monthly basis, remittances in April 2025 increased by 39 percent year on year, reaching approximately $3 billion, compared to $2.2 billion in the same month last year.”

The rebound in remittance flows comes amid broader economic reforms pursued under an International Monetary Fund-backed stabilization program. These reforms have bolstered Egypt’s foreign currency position and helped attract more international capital.

In May, Prime Minister Mostafa Madbouly announced that Egypt recorded real gross domestic product growth of 3.9 percent during the first half of the fiscal year. Private sector investment surged by 80 percent, while foreign direct investment rose by around 17 percent.

Inflation, however, remains a key challenge. The annual urban headline inflation rate accelerated to 16.8 percent in May, up from 13.9 percent in April, driven largely by continued pressure on non-food prices.

These inflation trends come as Egypt’s broader economic landscape continues to be shaped by both domestic and global pressures. The government is navigating a delicate recovery amid external shocks, ongoing structural reforms, and efforts to manage public debt.  

In February, Moody’s affirmed Egypt’s “Caa1” long-term foreign and local currency ratings with a positive outlook, citing improved debt servicing capacity, higher reserves, and falling borrowing costs.  

The ratings agency noted that recent currency devaluation and flotation helped boost foreign exchange reserves and reduce debt vulnerabilities. While a “Caa1” rating denotes high credit risk, the positive outlook reflects the government’s efforts to control inflation and stabilize interest rates. 

JEDDAH: The International Monetary Fund has warned that US airstrikes on Iran could amplify global economic uncertainty, with potential spillovers far beyond energy markets, its head told Bloomberg on Monday.

IMF Managing Director Kristalina Georgieva said that the fund is closely monitoring the situation in the Middle East, particularly the impact of the conflict on oil and gas prices and supply routes.

Georgieva’s remarks come after the US military conducted targeted strikes on nuclear facility sites in Iran, effectively involving itself in Israel’s campaign to dismantle the country’s nuclear program, despite Tehran’s threats of retaliation that could spark a wider regional conflict.

US President Donald Trump stated that Iran’s key nuclear sites were “completely and fully obliterated” and warned the country against retaliatory attacks, asserting that the US could strike additional targets “with precision, speed and skill.”

Georgieva told Bloomberg that the IMF are looking at this “as another source of uncertainty in what has been a highly uncertain environment” adding that the institution is watching for two things: “One, how would that impact risk premia for oil and gas. There has been some movement upward— how far would it go? And two: would there be any disruption in energy supplies?”

She went on: “For now, no. But let’s see how events would develop— whether either delivery routes or spillovers to other countries may occur. I pray, no.”

The development saw Brent crude briefly rising by as much as 5.7 percent to $81.40 per barrel during early Asian trading on June 23 before retreating, according to Bloomberg.

When asked whether the transmission mechanism, specifically the channels where she sees the greatest impact of the Middle East shock, is currently reflected in energy prices, the managing director confirmed that it is.

“There could be secondary and tertiary impacts. Let’s say there is more turbulence that goes into hitting growth prospects of large economies, and then you have a trigger impact in a downward revision in prospects for global growth,” she told Bloomberg. 

“As you know, we have already revised downward growth projections for this year, and we will be coming up with our next projections in July.”

Georgieva continued: “What we see in the first two quarters of the year broadly confirms the picture we painted in April, and it is somewhat slower global growth, but no recession.”

The IMF’s April report sounded a warning over the weakening global economy, sharply downgrading growth forecasts from January projections. 

The fund identified surging trade tensions, record-high tariff levels, and rising policy unpredictability as key threats to both short- and long-term economic stability.