The confirmation that Egypt’s presidential election has been moved forward to December is likely to keep the policy shift toward economic orthodoxy on pause for the time being. Our best guess now is that a pound devaluation will occur shortly after the election at the MPC meeting on 21st December, If officials don’t move quickly, it would significantly raise the threat of sharp and disorderly falls in the pound and the risk of a sovereign default. Elsewhere, Dubai’s sovereign debt risks have eased, but we are more concerned about still-large debts among government-related entities. And finally, our Spotlight series on implications of AI for economies and markets was released earlier this week. Click here to read the report.
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