Egypt is expected to sign the USD 12 bn loan agreement with the IMF next week, said Finance Minister Amr El Garhy in a call-in to MBC Masr’s “Yahduth fi Masr” (watch, runtime: 50:27, with El Garhy’s segment beginning in 7:45). His statements come as sources from the ministry tell Al Shorouk that the government is trying to get the IMF to increase the first payment of the loan to USD 3.5 bn from USD 2.5 bn to make it easier to service debt starting next year. The sources added that the this payment is expected to arrive next month. There’s already talk coming out of the ministry that the USD 2-2.5 bn eurobond issuance will be postponed until the arrival of the first payment, which would lower the borrowing costs, the sources say. Assuming these unnamed officials are correct, this would push back the date of the eurobond issue to next month. El Garhy had reportedly confirmed that the bond issue will take place in the last week of November.

And speaking of the IMF, an unnamed official from the fund was quoted by Al Shorouk as saying that last Thursday’s float and raising prices on fuel came as an unexpected (but pleasant) surprise as there had been doubts that the government would make the two moves simultaneously.

And speaking on the float, El Garhy said that the government had expected the volatility in the exchange rate and predicts the FX market will stabilize the coming weeks. El Garhy did confirm that the fuel subsidy bill had risen to EGP 65 bn as a result of the float, adding that some ministries will be negatively impacted by the decision, while others, such customs and Suez Canal revenues, will not.