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Daily Economic Update
27.08.2025Egypt: Remittances reach record high in FY2024/25, boosting confidence in the external position. Remittances from Egyptians working abroad increased significantly in FY2024/25 (ending June), rising by 66% y/y to an all-time high of $36.5 billion (from $22 billion in FY2023/24). Likewise, remittances in June registered a record monthly level of $3.6 billion (41% y/y), up from $2.6 billion in June 2024. Remittances represent one of the most important sources of foreign currency inflows for Egypt. This recent increase in remittances can be seen as a sign of confidence in Egypt’s banking sector after the sharp declines witnessed over the last few years amidst foreign currency shortages and the emergence of the parallel market.
Bahrain: Deflation in consumer prices steepens to -0.9% y/y in July. Deflation in consumer prices accelerated in July, falling to -0.9% y/y from -0.4% the previous month. July’s deflation reading was the fourth in a row, coming in well below expectations (0.3%) on the back of a steeper drop in food and beverage prices (-6.2% y/y from -3.6% in June). More rapid downward price pressure was also visible in the clothing & footwear (-5.0% y/y from -1.7%) and housing & utilities (-2% from -1.5%) categories. In contrast, higher inflation was recorded in the health (5.4% y/y vs 5.1%), transport (1.8% vs 1%), and recreation and culture (1.8% vs 0.7%) categories. On a monthly basis, consumer prices fell by 0.4%, partly reversing June’s gain of 0.9%.
US: Durable goods orders fall in July, but core capital goods orders rise. Durable goods orders in July fell for a second straight month, by 2.8% m/m following a steep 9.4% drop in June. However, orders for core capital goods (excluding defense and aircraft equipment) rose above forecast by 1.1% m/m from June’s decrease of 0.6%, indicating that business investment may be stabilizing given a lower level of uncertainty related to tariffs. In addition, the monthly rise in shipments of durable goods was the highest since May 2023 at 1.4% from 0.7% in June. Meanwhile, the annual increase in house prices, based on the S&P Case Shiller 20-city index, further moderated to an almost two-year low of 2.1% in June (2.8% in May). On a monthly basis, prices fell at a steady pace of 0.3%, extending the drop for the fourth consecutive month. The near-term outlook continues to be downbeat as elevated mortgage rates, steadily increasing housing unit inventories available for sale, and a weakening job market have been affecting the residential property market’s activity and prices in recent months. Finally, the Conference Board Consumer Confidence Index dropped to 97.4 in August from an upwardly revised 98.7 in July on worries about weak job and income prospects despite expectations of improved business conditions. According to the survey, an increasing number of respondents cited jobs were “hard to get” with fewer saying there was “plentiful” availability of jobs.
Eurozone: French government faces another possible collapse over budget issues. France has been thrown once again into heightened political uncertainty after Prime Minister Francois Bayrou called for a confidence vote on September the 8th. If successful, Bayrou’s confidence vote will shore up support after he faced renewed criticism over his plan to increase taxes and cut spending by a total of €44 billion in next year’s budget, which, he says, is necessary to save France’s public finances. However, as we stand now, it is more likely that he will lose the confidence vote. France currently has one of the highest debt/GDP ratios and budget deficits in the EU. If Bayrou’s confidence vote fails, it will make him the second prime minister to be ousted in less than a year, underscoring France’s political and budgetary crisis. French stocks have dropped by 3.3% over Monday-Tuesday while the 10-year yield jumped by around 8 bps on Monday.
China: Industrial profits decline at a slower pace in July. Chinese firms’ profits declined by 1.7% y/y in the Jan-July period, a slight moderation on the 1.8% recorded in the first six months of the year, highlighting continued demand-related weakness. Despite the slowdown in the pace of decline, which could be a potential sign that efforts to ease cost competition are starting to translate into improved earnings, businesses continued to struggle with weak domestic demand and ongoing deflation at the factory level, even with the government’s supportive policies to curb overcapacity. China’s economy continues to show signs of weakness, with retail sales growth cooling in July and consumer prices hovering just above deflation territory.