Only one kind of trader doing well as Egypt pound weakens

Since Egypt devalued its currency, life in Cairo has gotten a lot easier if you sell stocks for a living – and a lot harder if you sell fruit. Mostafa Nagaty at Arqaam Capital says he’d begun to fear that “this profession was dying.” Investors had fled Egypt after the uprising of 2011, and strict exchange-rate controls helped keep them away. Then, four months ago, the central bank let the pound float. “Now I’m getting approached by all types of clients,” said Nagaty, who’s head of institutional sales. “It’s amazing how things have changed.”

Across the Nile, and visible from Nagaty’s office window, is the working-class district of Embaba where Gamil Hassan has a market stall. Things have changed for him too, and not in a good way. After the pound lost half its value, inflation surged to 30 percent. “People don’t buy 3 or 5 kilos of fruit any more, they get just enough for the day,” Hassan said. “I’m used to prices going up. But what’s happening now is just crazy.”

There are about 92 million Egyptians. Hardly any of them care about the price of stocks. Almost all of them care about the price of food. And popular revolts have toppled two presidents in six years. So a reform program based around devaluation represents a big political risk. The government says it’s bitter medicine for an ailing economy. Will the public remain patient until it kicks in?