Lebanon’s debt swap, Egypt’s pound, Kuwait’s budget

The unravelling this week of a proposed debt swap by the Lebanese authorities suggests that, even once a government is formed, debt restructuring will be a drawn-out process. Elsewhere, the Egyptian pound has strengthened further this week, but it is starting to look overvalued and we expect it to give up its gains over the rest of this year. And the Kuwaiti 2020 budget unveiled this week reinforces our view that, despite having the strongest balance sheets in the Gulf, political infighting will prevent fiscal loosening.