The Egyptian pound experienced a marginal recovery against the US dollar on Thursday, closing at EGP 52.07 for buying and EGP 52.21 for selling, according to Central Bank of Egypt (CBE) data. This slight strengthening comes after a week of pressure, during which the currency remained around 1.5 percent weaker than at the start of the week. Despite this modest recovery, the pound's value is still around EGP 0.8, or 1.5 percent, weaker than it was on Sunday.
The weekly decline in the Egyptian pound's value can be attributed to the US Federal Reserve's decision to raise its benchmark interest rate by 25 basis points on Wednesday, its first increase since 2023. This move strengthened the dollar globally amid continued concerns over inflation. Furthermore, the Fed's latest projections suggest the possibility of one further rate increase this year. As a result, markets are eagerly awaiting the CBE's upcoming Monetary Policy Committee meeting on 24 September to review key interest rates.
The Egyptian pound remains around EGP 4.2, or 8.8 percent, weaker than its pre-conflict level of EGP 47.99 against the dollar. Across various banks, the dollar traded between EGP 52.08 and EGP 52.17 for buying and between EGP 52.18 and EGP 52.27 for selling. Abu Dhabi Islamic Bank offered the highest rates at the close, while state-owned National Bank of Egypt quoted the dollar at EGP 52.08 for buying and EGP 52.18 for selling.
Other state-owned lenders, such as Commercial International Bank (CIB), had slightly different rates, with the dollar trading at EGP 52.03 for buying and EGP 52.13 for selling. In addition to the Egyptian pound's performance against the dollar, other currencies also experienced changes. The euro weakened slightly against the Egyptian pound on Thursday, trading at EGP 59.76 for buying and EGP 59.93 for selling, down from EGP 60.15 and EGP 60.31 on Wednesday.
Despite the slight decline, the euro remains above Sunday's rates of EGP 59 and EGP 59.17. The British pound followed a similar pattern, trading at EGP 69.68 for buying and EGP 69.90 for selling on Thursday, down from EGP 70.23 and EGP 70.43 on Wednesday but above Sunday's EGP 69.35 and EGP 69.55. Gulf currencies also eased from Wednesday's levels while remaining higher than at the beginning of the week.
The Kuwaiti dinar traded at EGP 169.41 for buying and EGP 169.91 for selling, compared with EGP 169.82 and EGP 170.33 on Wednesday and EGP 167.23 and EGP 167.73 on Sunday. Similarly, the Bahraini dinar stood at EGP 138.51 on Thursday, virtually unchanged from Wednesday and up from EGP 136.46 on Sunday. The Omani rial traded at EGP 135.63, down slightly from EGP 135.80 on Wednesday but above Sunday's EGP 133.65.
Gold prices also saw an increase on Thursday, with the gold sovereign (geneih dahab) rising by EGP 200 to EGP 50,920 from EGP 50,720 on Wednesday, according to gold trading platform iSagha. Meanwhile, 24-karat gold gained EGP 28.50 to EGP 7,274.25 per gram from EGP 7,245.75 on Wednesday. These changes in currency and gold prices reflect the ongoing economic trends and market responses to global and regional events.
Key points
- The Egyptian pound's value remains around 8.8 percent weaker than its pre-conflict level.
- The US Federal Reserve's interest rate hike contributed to the pound's decline.
- The CBE's Monetary Policy Committee meeting on 24 September may lead to further changes in interest rates.
