Too early to expect a strong rebound in the Egyptian economy

The preliminary data from Egypt suggest that GDP grew by 1.8% y/y in the 2010/11 fiscal year (which runs from July to June). The output data (if not revised when more details are released on the 22nd) mean that Q2’s output was better than expected. Since both tourism and government spending fell, Egypt’s economy is likely to have been boosted by manufacturing, hydrocarbons and Suez Canal revenues. However, given the current global economic climate, we think it is too early to expect a rapid recovery.