The Saudi riyal saw a slight increase against the Egyptian pound at the close of trading on Thursday in most Egyptian public and private banks. This movement comes within the context of daily trading reflecting the supply and demand dynamics in the foreign exchange market following the Central Bank of Egypt's decision to fully liberalize the exchange rate in March 2024.
Historical background and economic context of the relationship between the two currencies
The value of the Saudi riyal and the Egyptian pound is linked to deep economic and trade relations between the Kingdom of Saudi Arabia and the Arab Republic of Egypt. Saudi Arabia is one of Egypt's largest trading partners and a major source of foreign direct investment. However, the exchange rate's greatest significance lies in its connection to remittances from Egyptians working in the Kingdom, which constitute a primary source of hard currency for the Egyptian economy and directly impact the living standards of millions of families in Egypt.
Historically, the Egyptian pound has gone through several stages of valuation against foreign currencies, the last and most influential of which was the decision to fully float it in the first quarter of 2024. This decision made the exchange rate more flexible and responsive to market mechanisms, leading to daily fluctuations in its value against major currencies, including the Saudi riyal, which is pegged to the US dollar.
The importance of the riyal exchange rate and its impact on the Egyptian economy
The impact of the riyal's exchange rate extends beyond financial transfers to other vital sectors. The riyal's value is a crucial indicator of the costs associated with performing Hajj and Umrah for Egyptian citizens, as all travel and accommodation expenses in Saudi Arabia are paid in riyals. Therefore, any increase in its value adds to the financial burden on pilgrims.
On the trade front, the exchange rate affects the cost of Egyptian imports from Saudi Arabia, and vice versa for Egyptian exports to the Saudi market. Exchange rate stability is a crucial factor in boosting trade and providing a stable and attractive investment environment for investors from both countries.
Saudi Riyal exchange rates in major Egyptian banks today, Thursday
Below is a list of Saudi Riyal exchange rates for buying and selling in a number of Egyptian banks at the end of today's trading:
- The Central Bank of Egypt: The buying price was recorded at 12.50 Egyptian pounds, and the selling price at 12.54 Egyptian pounds.
- National Bank of Egypt: The buying price was 12.46 Egyptian pounds, and the selling price was 12.54 Egyptian pounds.
- Bank of Egypt: The buying price reached 12.46 pounds, and the selling price reached 12.54 pounds.
- Bank of Alexandria: The buying price was recorded at 12.49 pounds, and the selling price at 12.53 pounds.
- Commercial International Bank (CIB): The buying price was 12.49 Egyptian pounds, and the selling price was 12.54 Egyptian pounds.
- Abu Dhabi Islamic Bank: The buying price reached 12.52 pounds, and the selling price reached 12.55 pounds.
- Faisal Islamic Bank: The purchase price was recorded at 12.46 pounds, and the selling price at 12.53 pounds.
These prices reflect slight variations between different banks and are subject to continuous updates throughout the day according to trading activity in the interbank market.
