Filtered by Subscriptions: Middle East & North Africa Economics Use setting Middle East & North Africa Economics
The Russia-Ukraine crisis has already pushed up global wheat prices and Egypt is particularly vulnerable due to its high dependency on imports from both countries. This could lead to a small widening of Egypt’s current account deficit, but – with …
3rd March 2022
Egypt’s government looks set to continue its commitment to tight fiscal policy and bringing down the public debt ratio. However, we hold concerns over the increasing levels of foreign currency debt that will be vulnerable if, as we expect, the pound …
23rd February 2022
Mortgage lending in Saudi Arabia has ramped up sharply in recent years as the government has tried to push up homeownership among Saudi nationals. This has not provided much of a boost to property prices and there are reasons to think that they will …
15th February 2022
The Central Bank of Egypt (CBE) kept interest rates unchanged at Thursday’s MPC meeting amid stronger price pressures and, if we’re right in expecting the authorities to let the pound weaken gradually this year at the same time that US Federal Reserve …
3rd February 2022
Egypt’s current account deficit has widened to alarming levels over the past couple of years which partly reflects the impact of the pandemic but it is also a symptom of an increasingly overvalued currency. We think policymakers will let the pound …
2nd February 2022
With oil prices at current levels, nearly all of the Gulf economies are running twin budget and current account surpluses. We think that governments are more likely to save rather than spend this windfall, limiting the impact on the region's non-oil …
1st February 2022
Saudi Arabia’s economic recovery has hit a bump in the road over the past month or so as the Omicron variant has caused activity in the Kingdom’s non-oil economy to slow. But the experience from other countries suggests this disruption will be brief and, …
26th January 2022
We think that GDP growth in the Gulf will be stronger than most expect this year on the back of rising oil output. Elsewhere, we expect a larger depreciation of the Egyptian pound than most anticipate and, if anything, there is a growing risk of an even …
12th January 2022
December’s batch of whole economy PMIs showed that activity in non-oil sectors in the Gulf softened due to the uncertainty created by the emergence of the Omicron variant. Restrictions have been tightened in recent weeks, but the experience from other …
5th January 2022
OPEC+ left the door open last week to change its oil output policy before the next meeting and, if output is raised more slowly or not at all, this would knock GDP growth back mechanically in the Gulf – plausibly by around 0.5%-pts next year. At the same …
8th December 2021
November’s batch of whole economy PMIs showed that non-oil sectors in the Gulf continued their recent strong trend, but the emergence of the Omicron variant – and threat of tighter restrictions – presents a clear downside risk to our above-consensus 2022 …
7th December 2021
The economic recovery in Saudi Arabia has picked up pace and should end the year on a strong note. The emergence of the Omicron variant has clouded the outlook, but for now we expect economic growth in the Kingdom to strengthen in 2022 on the back of …
2nd December 2021
Tunisia’s external position is in a dire state and policymakers have little ammunition available to defend the dinar. We think the currency will depreciate by more than 10% against the euro by the end of next year and the risks lie heavily to the …
25th November 2021
Most banking sectors in the region (with the notable exception of Lebanon) have, so far, come through the COVID-19 crisis in relatively good shape. But with support programmes now being withdrawn, there is a risk that vulnerabilities in Tunisia, Qatar, …
18th November 2021
Saudi Arabia’s economic recovery looks to have picked up speed in Q3 and should remain strong over the rest of this year and 2022, underpinned by rising oil output. Final Q2 GDP figures showed the economy expanded by 0.7% q/q in seasonally-adjusted terms, …
4th November 2021
The rally in oil prices has opened the door for some of the larger Gulf economies to loosen fiscal policy, but governments in Bahrain and Oman will need to continue tightening to repair their dire balance sheets. Even with further fiscal consolidation, we …
3rd November 2021
The Central Bank of Egypt (CBE) kept interest rates unchanged at Thursday’s MPC meeting amid rising price pressures. Against this backdrop, we think that the central bank is likely to delay the resumption of its easing cycle until the middle of next year. …
29th October 2021
Higher oil and gas revenues are likely to prompt a modest shift to looser fiscal policy in the large Gulf economies, although Bahrain and Oman will still need to stick to austerity. Meanwhile, if OPEC+ were to raise production quotas more quickly in …
20th October 2021
Egypt’s economy has emerged from the COVID-19 crisis relatively well, but the country’s lagging vaccine rollout, a slow return of international tourists and tight fiscal policy mean that the recovery from here is likely to be slow-going. GDP is likely to …
6th October 2021
The long-awaited World Expo in Dubai will get underway next Friday and while there is likely to be some boost to the economy, this will be short lived. What’s more, as we have long warned, the Expo could leave high rates of overcapacity in Dubai’s real …
23rd September 2021
The Central Bank of Egypt (CBE) kept interest rates unchanged at Thursday’s MPC meeting amid rising price pressures. However, we still think that inflation will slow in the final months of this year and re-open the door for the CBE to resume its easing …
17th September 2021
Jordan’s public finances deteriorated sharply last year and fiscal consolidation is needed to put the debt position back on a sustainable footing. Sticking to austerity may prove difficult given the economic and political backdrop and the composition of …
15th September 2021
Saudi Arabia’s economic recovery lost some steam in Q3 but, with virus restrictions easing further and oil production rising, GDP growth will strengthen over the rest of this year and next. The Q2 flash estimate of Saudi GDP showed the economy expanded by …
7th September 2021
Morocco’s strong vaccine rollout and a rebound in the agricultural sector will support a robust recovery over the coming quarters. Although a slow return of tourists and fiscal consolidation will act as headwinds, we still think that GDP growth will be …
2nd September 2021
A rise in oil prices has supported an improvement in Saudi Arabia’s current account position, which should be in surplus over the coming years. That, combined with signs that the sovereign wealth fund is slowing its international investments, will help to …
16th August 2021
The Central Bank of Egypt (CBE) kept its policy rate on hold on Thursday, and we continue to hold a non-consensus view that a fall in inflation later in the year will allow the CBE to resume its easing cycle in Q4. The decision to keep the benchmark …
6th August 2021
Saudi Arabia’s economic recovery appears to have been quite strong in Q2 and the further easing of virus restrictions and rising oil production means that GDP growth will continue to gather steam over the rest of this year and into 2022. The economy …
29th July 2021
The decision by Tunisia’s President Kais Saied to sack the prime minister and freeze parliament has raised serious concerns about the future of democracy in the country and couldn’t come at a worse time for the economy, which is already reeling from the …
26th July 2021
Saudi inflation is set to fall sharply in July as last year’s VAT hike falls out of the annual comparison. While there will be some upwards inflation pressure from the re-opening of the economy and global supply shortages, a weak recovery in demand is …
1st July 2021
Saudi Arabia’s economic recovery seems to have got back on track in Q2 and, as virus restrictions are eased further and oil production cuts are scaled back, a strong second half of the year lies in store. The final Q1 GDP figures confirmed that the Saudi …
29th June 2021
Virus numbers have fallen in the past few months in the MENA region and a rapid vaccine rollout should allow most of the Gulf economies, as well as Morocco, to lift restrictions further over the second half of the year. Elsewhere in the region, where the …
21st June 2021
The Central Bank of Egypt (CBE) announced it kept interest rates on hold on Thursday evening and, with inflationary pressures building, the CBE is likely to refrain from cutting rates in the near term. Even so, very high real interest rates and the …
18th June 2021
Negotiators appear to be closing in on an agreement to revive Iran’s nuclear deal which, if revitalised, would provide a substantial lift to Iran’s economy – it could plausibly expand by 8-10% per year in 2021-23. Higher Iranian oil output would act as a …
7th June 2021
Saudi Arabia’s economy suffered a small downturn in Q1 and the recovery so far this quarter has been slow-going. But, with the vaccine roll out picking up pace and restrictions being relaxed, coupled with rising oil output, the recovery is likely to …
2nd June 2021
Strong vaccine rollouts in the Gulf and Morocco have allowed for an easing of travel-related restrictions but there is still a long way to go and recoveries in tourism sectors are likely to be slow-going. And in the rest of the region, struggling …
26th May 2021
Egypt’s natural gas sector struggled last year as the slump in regional energy prices caused production and exports to fall. But the re-opening of key LNG infrastructure in recent months and prospects for rising exports into Europe will help to improve …
20th May 2021
Saudi Arabia’s budget deficit narrowed in the first quarter of the year on the back of higher non-oil revenues and a sharp reduction in capital spending. Higher oil revenues will support a further reduction in the shortfall in the coming quarters and it …
11th May 2021
The UAE has been one of the global leaders in its vaccine rollout thanks to the aggressive procurement of vaccines, numerous vaccination centres and wide eligibility. Containment measures have been kept looser than in the likes of the UK and Israel and …
5th May 2021
Saudi Arabia’s economy is likely to have suffered a fresh downturn in Q1 on the back of oil production cuts and tighter virus containment measures. But with the vaccine roll out picking up pace and oil output rising from May, the recovery is likely to …
4th May 2021
The Central Bank of Egypt (CBE) opted to keep interest rates on hold at its meeting today and, with inflation likely to rise over the coming months, we think policymakers will keep rates unchanged until Q4. But if the recent weakness of inflation …
28th April 2021
The UAE banking sector’s non-performing loan ratio has hit its highest level since 2005, although banks’ high level of profitability coming into the crisis has helped to shield them so far. And strong capital buffers mean that they look well positioned …
14th April 2021
Saudi Arabia’s tightening of COVID-19 restrictions has weighed on activity in the non-oil sector and the voluntary oil output cut has hit the hydrocarbon sector too. But, with the vaccine rollout accelerating and oil production likely to increase soon, …
30th March 2021
Despite the recent rise in bond yields, we think that Egypt’s public debt ratio will resume its downward trend in the coming years. Since the start of the year, Egypt’s local currency bond yields have risen by 40bp, on average, across the yield curve, …
24th March 2021
The Saudi government’s efforts to improve the Kingdom’s business environment and attract foreign direct investment in recent years haven’t had the desired effect. One result is that the government is likely to lean heavily on the sovereign wealth fund, …
4th March 2021
Saudi Arabia’s economic recovery has continued to be slow going as the tightening of COVID-19 restrictions has weighed on activity. The slow start to the vaccine rollout and the Kingdom’s voluntary oil output cuts this month and last will delay a …
1st March 2021
A severe COVID-19 outbreak has added to the long list of troubles in Lebanon and, given renewed social unrest and the fact that talks with both the IMF and international creditors are at a standstill, it is likely that economic conditions will remain dire …
17th February 2021
Saudi Arabia’s unemployment rate has risen sharply in the past year and, while we expect it to fall back, the weak recovery means that it might take many years before it gets close to its pre-pandemic rates. Saudi Arabia didn’t publish labour market data …
10th February 2021
The Central Bank of Egypt (CBE) opted to keep interest rates on hold at its first meeting of the year and, with inflation set to rise over the next 6-9 months, we think policymakers will keep rates unchanged for much of this year. But a drop in inflation …
4th February 2021
The economic recovery in Dubai is going to be put on ice as a worsening COVID-19 outbreak results in increased precautionary behaviour and tighter containment measures. But if the strong start to the vaccine rollout continues, most restrictions will …
27th January 2021
Saudi Arabia’s economic struggled at the end of last year and a combination of a slow start to the vaccination programme, voluntary oil output cuts and tight fiscal policy means that the outlook for the first half of this year is pretty bleak. Final GDP …
19th January 2021