Dollar Falls Below EGP 16 in Egyptian Market

The price of the dollar continued to decline, against the Egyptian pound, to lose about 10 piastres over a week to record the average purchase price of EGP 15.99 against the US dollar, compared to EGP 16.09 a week earlier.

A banking official said that the wave of decline in the price of the dollar against the pound is expected to continue during the coming period, especially with the increase in investor confidence, and the arrival of the new  International Monetary Fund (IMF) tranche of $2 billion.

Finance Minister Mohamed Maait said that Egypt had received $2 billion from the fund and that the transfer had already entered the account of the Central Bank of Egypt (CBE).

The approval of the Executive Board of the IMF allowed Egypt to access $ 2billion out of a total “credit preparedness agreement” of $5.2 billion over a 12-month period, with the aim of helping Egypt cope with the consequences of the coronavirus pandemic, as well as supporting the state’s general budget and the balance of payments.

CBE said that the volume of foreign exchange reserve balances increased to about $38.2 billion at the end of June 2020, compared to about $36 billion at the end of May, an increase of about $2.2 billion.

The currency rate is a determiner for the performance of the economies of countries. When dollar flows and capital occur in hard currency, this supports the currency's strength, and in the context of progress and improvement of Egyptian economy indicators significantly over the past period, the price of the pound against the dollar was reversed during the 5 months with the rise of the local currency against the greenback.

This performance is expected to continue during the coming period, with the progress of economic indicators and the improvement of 5 basic dollar resources for Egypt.

The exchange rate in Egyptian banks is determined according to the mechanism of supply and demand, and the higher the dollar supply and the decrease in demand for it, the lower the dollar price becomes in the local market.