Egyptian dollar rate unlikely to fall below LE 50
Economist Mohamed Fouad cites foreign investment outflows and economic imbalances for the prediction.
Economist Mohamed Fouad stated that the US dollar exchange rate in Egypt will likely remain around 52 Egyptian pounds and is unlikely to fall below 50 pounds soon. He attributed this to foreign investment outflows, increasing financing needs, and structural economic problems. Fouad appeared on MBC Masr’s “al-Hekaya” program, hosted by Amr Adib.
Fouad explained that approximately $1.8 billion exited Egypt between Monday and Thursday of the previous week. He noted that a flexible exchange rate system makes the market sensitive to capital movements. Global factors, including strong US economic activity and energy market pressures, also contribute to dollar strength worldwide.
Domestically, investors are selling treasury bills and recovering funds from maturing three-month deals. Egypt's balance of payments shows a trade deficit of about $65 billion and a current account deficit of nearly $2.25 billion. These domestic imbalances combined with global financing pressures make the Egyptian economy vulnerable.
Why it mattersEgyptian citizens and businesses will be affected by the continued high exchange rate of the US dollar against the Egyptian pound.