“Bloomberg”: The Egyptian pound continues to rise with the increase in foreign exchange flows


The global “Bloomberg” agency stated that the Egyptian pound, one of the best performing currencies in the world during 2019, continues to rise with the increase in foreign exchange inflows, as it broke a key price barrier after entering inflows exceeding $ 1.5 billion during the past week.

And, “Bloomberg” explained in a report today, Tuesday, that the Egyptian pound recorded a new rise of 1.5% to 15.83 against the dollar yesterday, to trade at a level of less than 16 pounds against the dollar for the first time since March 2017, while local banks witnessed flows of up to 1.7 billion Dollars since last Wednesday.

She added that the rise of the Egyptian pound, whose exchange rate was liberalized in late 2016, led to an increase in the attractiveness of investment in debt instruments in local currency last year, which recorded a very attractive return of about 15% on local bonds, in addition to the economic reforms recommended by President Abdel Fattah El-Sisi.

“Bloomberg” indicated that the central bank has reduced the main interest rate by 350 basis points to 12.25% since last August, and is likely to reduce the interest rate again to about 11.5% next Thursday, according to a survey of economic analysts conducted by “Bloomberg” “.

“This supports the positive outlook of the Egyptian pound, which still attracts foreign investors, thanks to the high real rate of return and the decrease in the current account deficit and the rise of Revenue from tourism. ”

In turn, Alan Sandeep, head of research at the “Naim Brokerage Company” in Cairo, said that one of the main things that must be looked at in the future will be the external debt obligations of Egypt,

“It is likely that the deposits of Gulf countries will be renewed or extended, including Saudi Arabia and the United Arab Emirates,” he said.

“If this is to happen, the Egyptian pound is likely to rise or remain at 15.75 against the dollar,” Sandeep added.

He pointed out that the rise of the Egyptian pound also reflects the entry of investors to the market to obtain high returns before the expected rate cut on Thursday, as purchase orders for Egyptian treasury bills increased during the last two bids, to reach about 85 billion pounds ($ 5.3 billion) in a bid last Thursday alone.

Bloomberg notes that monetary easing does not significantly affect the rate of investor flows in government bonds.

The research sector at “Societe Generale” expects the pound to rise by 3.7% to record 15.35 pounds against the dollar by the end of this year.


Please enter your comment!
Please enter your name here