CAIRO: The price of the US dollar against the Egyptian pound has increased in recent days. One dollar is worth 49.25 Egyptian pounds.
Egyptian economic experts attributed the increase to recent regional developments.
“The biggest factor affecting the value of the dollar against the pound is Egyptian remittances abroad,” said economist Dr. Alaa Ali.
“If it rises, the dollar price will stabilize or fall against the pound, and if it falls, the dollar price will rise and thus the pound price will fall,” the economist told Arab News.
“Remittances from Egyptians abroad have been high since the Egyptian government took the decision to liberalise the exchange rate about eight months ago, which has contributed to the stability of the dollar price at around 48 pounds.
“However, due to recent tensions, Egyptians' foreign currency remittances have declined, causing the dollar to rise by about one pound against the pound,” Ali said.
“Tourism, investments, exports and Egyptian remittances account for a large share of dollar revenues.”
Ali expressed hope that the price would stabilize again when Egypt received the third tranche of its loan from the International Monetary Fund amounting to over $800 million.
Mohamed Shawqy, professor of economic risk management, also commented on the reasons for the recent rise in the dollar against the Egyptian pound.
Shawqy referred to regional tensions and the threat of an Iranian military response against Israel following the assassination of Hamas leader Ismail Haniyeh in Tehran.
He stressed to Arab News: “The more tense the situation in the region, the more negatively it affects the economic situation.”
The head of the import department of the Chambers of Commerce, Matta Beshai, said: “In recent times, there has been some reluctance among importers to use the dollar, fearing regional events and instability in the region.”
These developments “have prompted many to reduce their dollar spending and work to cut costs in every way possible, fearing an escalation of the regional situation in the face of Iranian threats of retaliation against Israel.”
He added: “Banks are operating normally and dollar payments to importers are proceeding normally following the Ras Al-Hekma deal, which enabled large financial flows under a historic $35 billion investment agreement.”
Beshai said that “the main reason for the rise in the dollar price among banks is the tensions in the regional situation, which have led to significant fears among investors.”
At the same time, he stressed that the state was “working normally and managing the crisis effectively.”
