Foreign exchange stability in Egypt hinges on continued US dollar inflows into the market

The Egyptian pound fell against the US dollar by 1.8 percent by the end of banking transactions over the first two working days after Eid al-Adha's eight-day holiday, which began officially on Saturday 15th of June and ended on Wednesday 19 of June but which included the weekend on Friday 20th and Saturday 21st of June.

The US dollar rose from 47.50/1 USD at the end of the last working day before the holiday to 48.37/ 1USD.

In the parallel currency market, sources in the importing sector told Ahram Online that the US dollar rate jumped from EGP 47.75/ 1 USD before the Eid Al-Adha holiday to EGP 48.40/1 USD as demand for the greenback increased and buying virtually stopped.

This drop comes after an appreciation of the Egyptian pound during the opening of transactions on Sunday -- when the EGP rate rose by 1.9 percent against the US dollar -- before reducing its losses to close at EGP48.20 /1 USD. Previously, the closing rate for the EGP against the US dollar stood at EGP47.50/1 USD on the last working day before the holiday.

Economists speaking to Ahram Online advised waiting until the end of the week to accurately gauge the market's reaction to the recent surge in the dollar's rate against the Egyptian pound to determine if this rise is a temporary fluctuation or the beginning of a sustained decline for the pound.