(Reuters) – Global ratings agency S&P on Friday downgraded Egypt’s long-term sovereign credit rating by one notch to “B-” , citing the country’s mounting funding pressures.
Egypt is battling an economic crisis that has triggered a string of currency devaluations, record inflation, and pushed more of its citizens to seek risky routes out of the country.
S&P said the downgrade reflects the recurring delays to the implementation of monetary and structural reforms in the country, among other factors.
Egypt’s economy will grow slower than earlier predicted as inflation eats into purchasing power and the Egyptian pound weakens, a Reuters poll showed on Thursday.
“Inflationary pressures are likely to remain high as we expect further exchange-rate weakness,” S&P said in a statement.
Earlier this month, Moody’s downgraded Egypt’s credit rating by a notch, citing the country’s worsening debt affordability.
“Due to the foreign currency crunch, we expect GDP growth to slow further in fiscal 2024,” S&P added, while placing the country’s outlook at “stable”.
(Reporting by Sri Hari N S in Bengaluru; Editing by Shailesh Kuber and Devika Syamnath)