Egypt reserves slip

Egypt's net foreign reserves slipped to $25.71 billion in July but economists said there was a slowdown in the rate of the decline which may now suggest the worst of the capital flight since the uprising to topple Hosni Mubarak was over. Foreign reserves had stood at $26.57 billion at the end of June, indicating a fall of $859 million in July.
"The rate of decline is seen to have stabilised and the worse of the capital outflows is probably behind us," said Liz Martins, a senior economist in HSBC.
In June, the reserves appeared to have fallen by just $659 million. But EFG-Hermes strategist Simon Kitchen said this figure was skewed because Egypt re-values its gold holdings each June, the end of the financial year, and this year an upwards recalculation disguised the scale of foreign currency outflows.
"Actually the fall in foreign currency assets was better month on month. It was down $859 million in July, and down $1.2 billion in June. The monthly fall in reserves looked better in June because the value of gold reserves was re-valued upwards," he said. He added that the upward revision in the value of Egypt's gold was worth $563 million in June 2011.