October 24, 2019 / 2:43 PM / 20 days ago

Egyptian pound strongest in more than two and a half years

CAIRO, Oct 24 (Reuters) - The Egyptian pound strengthened further against the U.S. dollar on Thursday, trading at 16.10 against the greenback, its strongest in more than two and a half years.

The pound has seen a steep climb in 2019, rising 9.85% against the dollar since Jan. 1. Analysts have said it was mainly boosted by higher foreign exchange inflows.

Those FX inflows mainly came from investments in Egyptian treasuries, steadily improving tourism, strong remittances from workers abroad and a narrowing trade deficit, said Allen Sandeep, head of research at Naeem Brokerage.

The pound rose 2.4% this month alone. It was last this strong on March 4, 2017.

Sandeep said he expected the pound to continue appreciating against the dollar through the first quarter of 2020.

Mohamed Abu Basha, an economist at Egyptian investment bank EFG Hermes, said a strong pound would help maintain low inflation, which hit its lowest in almost seven years last month, and could potentially stimulate greater consumption.

“It’s not helping exports though, but the latter is a relatively much smaller part of the economy,” he said. The pound was devalued in November 2016, when it traded at 8.88 to the dollar, as part of an economic reform programme tied to a three-year, $12 billion loan from the IMF. It reached its weakest shortly after the devaluation, trading at 19.62 in December 2016.

Reporting by Yousef Saba; Editing by Angus MacSwan

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below