Why did Egypt buy 44 tons of gold at the beginning of 2022?

Publish Date: 11 May 2022


Why did Egypt buy 44 tons of gold at the beginning of 2022?

How does Egypt increase its domestic production of gold?

Why do you think the Central Bank of Egypt bought 44 tons of gold recently? Specifically at the beginning of this year 2022?

The Egyptians Cabinet’s Information and Decision Support Center (IDSC) officially announced that the Central Bank of Egypt bought 44 tons of gold in February 2022, making it the largest buyer of gold among global central banks during the first quarter of 2022.


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The volume of gold in the Central Bank of Egypt


After the purchase of 44 tons of gold, the volume of gold at the Central Bank of Egypt increased by 54% to reach 125 tons by the end of February 2022, equivalent to 17% of the total Egyptian reserves which are considered the highest in the region.


Egypt Increases Local Gold Production


Egypt is working to increase the production of gold in the long term from the Sukari gold mine among others. Egypt produces about 16 tons of gold annually, mostly from the Sukari mine in Aswan Governorate.


Why Egypt is buying more gold


According to the opinions of experts collected by Faydety, Egypt buying this amount of gold during the first quarter of 2022 has several benefits such as:


  • Currency coverage.
  • Encouraging foreign investors with the message that Egypt has the courage and willingness to fight inflation.
  • Strengthen the country’s reserves.
  • A precautionary measure for fear of any possible political fluctuations that may occur during the coming period, which could cause an increase in the price of the dollar as well as global inflation.
  • Linking cash reserves to gold and not to United States Dollar, helps the country face any economic surprises that may occur at any time.


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No official explanation from the Egyptian side


So far, the official government report by the IDSC is the source of all this information, but there has been no explanation from an official Egyptian authority as to why Egypt's is buying gold to support its reserves.

Also, no details were provided to help investors understand the monetary and economic policies of the Egyptian government and to reduce the debate about the positive or negative impact of this step on the Egyptian economy

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