The US dollar has depreciated by 4 piasters against the Egyptian pound since the beginning of the week. The Egyptian currency’s rise was buoyed by positive news, including International Monetary Fund (IMF) approval on a new $5.2bn financial agreement with Egypt. The resumption of international tourism to some tourism-centric cities in the country after a three-month hiatus has also given the local currency a boost.
At the end of last week, the National Bank of Egypt (NBE) reported that the Egyptian pound was trading at EGP 16.21 to buy and EGP 16.11 to sell. It currently stands after its appreciation against the US dollar, at EGP 16.17 to buy and EGP 16.07 to sell.
Mohamed Roshdy, a foreign exchange company official, said the US dollar supply has been continuously increasing since the end of the first week of June.
He noted that foreign currency cash flows have begun to return to normal, as foreign investments in Egyptian treasury bills (T-bills) have jumped to over $10bn. This comes on the back of their dramatic decline in March and April, due to the market impact of the novel coronavirus (COVID-19) pandemic.
Roshdy added that Egypt has recently also undertaken several steps that have buoyed its foreign currency reserves. This includes the new $5.2bn IMF agreement, and Egypt’s success in promoting the offering of $5bn worth bonds on the international market. The latter has been oversubscribed 5 times at a value of $22bn.
He added that the resumption of tourism would also push foreign exchange resources, especially since the country’s imports bill has fallen.