Cairo: The price of the US dollar has risen against the Egyptian pound in recent days, with $1 worth 49.25 Egyptian pounds.
Egyptian economic experts say the increase is due to recent regional developments.
“The most important factor affecting the price of the dollar against the pound is the remittances coming into the country by Egyptians,” said Dr. Alaa Ali, an economic expert.
“If the price increases, the price of the dollar will remain the same or decrease against the pound, and if the price decreases, the price of the dollar will increase and the price of the pound will decrease,” the economist told Arab News.
“Remittances from Egyptians abroad have increased since the Egyptian government decided to liberalize the exchange rate about eight months ago, which has stabilized the dollar at around £48,”
“However, due to recent tensions, remittances from Egyptians in foreign currencies have decreased, resulting in the dollar’s price against the pound increasing by about a pound,” Ali said.
“The sources of Egyptian tourism, investment, exports and remittances are all huge in dollar revenue.”
Ali said he hoped prices would stabilize again with Egypt receiving a third tranche of a loan from the International Monetary Fund worth about $800 million more.
Mohammad Shawki, professor of economic risk management, also commented on the reasons for the recent increase in the price of the dollar against the Egyptian pound.
Shawki addresses regional tensions and threats of Iranian military retaliation against Israel following the assassination of Hamas leader Ismail Haniyeh in Tehran.
“The more tense the situation in the region is, the more negatively the economic situation will be affected,” he stressed to Arab News.
“Importers have been more reserved about the dollar in recent times due to fears about regional events and regional uncertainty,” said Matta Beshai, head of the chamber’s importers division.
The development “has prompted many to reduce their spending in dollars and work to cut costs in every possible way, fearing that the situation in the region could explode as Iran threatens to retaliate against Israel.”
“Banks are operating normally and dollars are being paid to importers as usual after the Ras Al-Hekma deal, which has enabled significant capital flows under a historic $35 billion investment deal,” he added.
“The main reason for the rise in the dollar price at the bank is the tension in the regional situation, which has created clear fear among investors,” Bechai said.
He also stressed that the government “is functioning normally and has effectively handled the crisis.”
