CAIRO: The price of the US dollar rose against the Egyptian pound in recent days, with one dollar worth 49.25 Egyptian pounds.
Egyptian economic experts attributed the increase to recent regional developments.
“The biggest factor affecting the price of the dollar against the pound is remittances from Egyptians abroad,” says Dr. Alaa Ali, an economic expert.
“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 decision to liberalize the exchange rate taken by the Egyptian government about eight months ago, which helped to stabilize the dollar price at around 48 pounds.
“However, the recent tensions have reduced remittances from Egyptians in foreign currency, and thus the dollar price against the pound has increased by about one pound,” Ali said.
“The sources of tourism, investment, exports and remittances of Egyptians have a great value in dollar earnings.”
Ali said he hoped the price would stabilize again once Egypt received the third tranche of its loan from the International Monetary Fund, which exceeded about $800 million.
Mohamed Shawqy, professor of financial risk management, also commented on the reasons behind the recent increase in the price of the dollar against the Egyptian pound.
Shawqy referred to regional tensions and the threat of an Iranian military response to Israel following the assassination of Hamas leader Ismail Haniyeh in Tehran.
He emphasized to Arab News: “The more tense the situation in the region, the more negatively the economic situation is affected.”
The head of the importers department at the chambers of commerce, Matta Beshai, said: “The recent period has seen a sort of reservation among importers regarding the dollar, fearing regional events and instability in the region.”
This development “prompted a large number to reduce spending in dollars and work to reduce costs in every possible way, fearing an explosion of the regional situation in light of Iranian threats to retaliate against Israel.”
He added: “Banks are operating normally, and dollars are being paid out to importers normally after the Ras Al-Hekma deal, which helped with large financial flows in a historic investment deal that reached $35 billion.”
Beshai said that “the main reason for the increase in the dollar price in banks is the tension in the regional situation, which led to clear fear among investors.”
At the same time, he emphasized that the state “worked normally and handled the crisis effectively.”
