Economic Snapshot for MENA
January 13, 2020
Economic growth is set to accelerate notably in 2020
MENA’s regional growth is expected to recover this year, following a poor performance in 2019, due to a much smaller contraction in Iran and an expected recovery in oil output. That said, risks to the economic outlook are skewed to the downside, including a potential extension of the OPEC+ oil cut deal beyond the March deadline and widespread geopolitical risks.
MENA Monetary & Financial Sector News
Inflation in the Middle East and North Africa fell from October’s 4.8% to 4.7% in November. The reading was the lowest since June 2018 and mostly reflected declining inflation in Algeria, Israel and Iran. Despite resurfacing price pressures in GCC countries, inflation will moderate slightly this year on falling inflation in Egypt and Iran.
Most central banks in MENA manage currency pegs, mostly against the USD or a basket of currencies including the USD or the EUR, and thus lack independent monetary policies. That said, the central banks of Egypt and Israel left their main policy rates unchanged in recent weeks.
The EGP continued to strengthen against the USD in recent weeks on solid economic fundamentals. The Israeli shekel, in turn, was broadly unchanged. That said, most remaining countries in the region maintain a de jure or de facto currency peg against the U.S. dollar or a basket of currencies mostly composed of the USD and/or the EUR.
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5 years of Middle East & North Africa economic forecasts for more than 30 economic indicators.
Middle East & North Africa Economic News
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Egypt: Central Bank leaves interest rates unchanged in January
January 16, 2020
The Central Bank of Egypt (CBE) held interest rates steady at its monetary policy meeting on 16 January, leaving the overnight deposit rate at 12.25%.
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Israel: Manufacturing PMI dips in December but remains in expansionary territory
January 16, 2020
The Purchasing Managers’ Index (PMI), produced by Bank Hapoalim and the Israeli Purchasing & Logistics Managers Association (IPLMA), fell to 51.8 in December from 52.8 in November, but remained above the neutral 50-mark separating expansion from contraction in the manufacturing sector.
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Israel: Inflation rises somewhat in December but stays below-target
January 15, 2020
Consumer prices were flat in December over the prior month, following November’s 0.4% decline.
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Saudi Arabia: Oil prices surge in early January on mounting geopolitical risks
January 13, 2020
Oil prices jumped in the aftermath of the assassination of Iranian Major General Qasem Soleimani by a targeted U.S. drone strike on 3 January, as markets were anticipating retaliation from Iran.
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Israel: Exports fall further in December, rounding off a tepid 2019, while imports rebound
January 13, 2020
Merchandise exports fell 2.5% in December in USD terms, following November’s revised 0.4% expansion (previously reported: -1.0% year-on-year).
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