S&P upgrades Egypt’s credit rating to ‘B’; Fitch affirms with stable outlook
Updated 10/12/2025 7:48:00 AM
Arab Finance: S&P Global Ratings has upgraded Egypt’s long-term sovereign credit rating to ‘B’ from 'B-', while Fitch Ratings affirmed its ‘B’ rating; both with a ‘stable’ outlook.
S&P Global cited the country’s ongoing reform measures and signs of economic recovery, affirming the ‘B’ short-term sovereign credit rating.
The agency also raised its transfer and convertibility assessment to ‘B’ from ‘B-’ for Egypt.
S&P’s decision marks the first upgrade since Egypt began receiving financial assistance in March 2024.
The agency said structural reforms, including the liberalization of the foreign exchange regime, have contributed to stronger GDP growth, improved tourism, and higher remittance inflows.
According to S&P, Egypt’s GDP growth has improved over the past 18 months, supported by reforms and increased foreign currency inflows.
The agency also noted Egypt’s strategic importance amid regional tensions, adding that the conflict in Gaza has reinforced the country’s role in regional stability.
This has encouraged ongoing financial backing from the Gulf Cooperation Council (GCC) states and other international partners
Meanwhile, Fitch noted Egypt’s growth potential and continued external support, expecting a gradual recovery in Egypt's depressed energy balance, backed by a moderate resumption of investment by international oil companies.
It also forecasts Egypt's foreign direct investment (FDI) to pick up to an average $15.5 billion, or 3.4% of gross domestic product (GDP) in fiscal years (FY) 2026-2027, from $13.2 billion in FY2024/2025, partly due to new GCC real estate investment.
Moreover, Fitch projects inflation will average 12.3% in FY2025/2026, reflecting better anchored inflation expectations but more sticky services inflation and administered prices' pressure, falling to 10.4% in FY2026/2027, about double the 'B' median of 5%.
The agency also expects the policy interest rate to be cut from 21.5% to a level consistent with a real rate of near 4% by FY2026/2027.
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