The US dollar exchange rate against the Egyptian pound remained relatively stable, with a slight downward trend, at the close of trading on Tuesday in both Egyptian public and private banks. This stability comes as the Egyptian economy enters a new phase following the Central Bank's decision to fully liberalize the exchange rate in March 2024, a measure aimed at eliminating the parallel currency market and unifying the exchange rate.
General context of exchange rates in Egypt
This stability comes after a period of significant volatility for the Egyptian pound. On March 6, 2024, the Central Bank of Egypt made a historic decision to float the pound, allowing its value to be determined by market forces of supply and demand. This decision was part of a broader package of economic reforms aimed at addressing the challenges facing the economy, primarily the shortage of foreign currency and high inflation. This measure coincided with a 600-basis-point interest rate hike to curb inflation and attract foreign investment. The major Ras Al Hekma investment deal with the United Arab Emirates also contributed to a substantial influx of dollar liquidity, enhancing the Central Bank's ability to manage the exchange market more flexibly.
The importance of exchange rate stability and its impact
The stability of the dollar exchange rate is a vital indicator for both local and international investors. Domestically, currency stability helps control inflation rates, as Egypt relies on imports for many essential goods and raw materials. Therefore, any fluctuation in the dollar's value directly impacts the prices of these goods in the local market. Internationally, a flexible and transparent exchange rate enhances the confidence of foreign investors and encourages increased direct and indirect investment, thereby supporting economic growth and creating new job opportunities.
Dollar exchange rates in major Egyptian banks today
Below are the details of the dollar exchange rates in a number of banks at the end of trading today:
- Central Bank of Egypt: The buying price was recorded at 46.80 Egyptian pounds, and the selling price at 46.93 Egyptian pounds.
- National Bank of Egypt: The buying price was 46.84 Egyptian pounds, and the selling price was 46.94 Egyptian pounds.
- Bank of Egypt: The buying price was recorded at 46.84 Egyptian pounds, and the selling price at 46.94 Egyptian pounds.
- Commercial International Bank (CIB): The buying price was 46.82 Egyptian pounds, and the selling price was 46.92 Egyptian pounds.
- Bank of Alexandria: The buying price was recorded at 46.80 Egyptian pounds, and the selling price at 46.90 Egyptian pounds.
- Abu Dhabi Islamic Bank: The buying price was 46.88 pounds, and the selling price was 46.98 pounds.
Market participants are awaiting upcoming economic data and foreign exchange flows to determine future exchange rate trends, amid government assurances to move forward with the economic reform program to ensure sustainable stability.
