ISTANBUL

Fitch Ratings said Friday that it upgraded Egypt's long-term foreign currency issuer default rating to B from B- with a stable outlook.

The rating agency said the upgrade reflects the country's lower external risk, policy adjustment, replenished external buffers, new capital inflows and more flexible exchange rate.

While inflation fell to 26.4% in September from 35.7% in February, Fitch forecasts it slowing to 12.5% at the end of fiscal year 2025.

The rating agency projects the interest rate to be held at 27.25%, following increases of a total of 800 basis points during the first quarter of this year.

Fitch forecasts GDP growth picking up from 2.4% in 2024 fiscal year to 4% in 2025 fiscal year amid strengthening confidence, real incomes, remittances and foreign direct investments.