Source: Cairo – Khaled Hosni
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The Egyptian pound maintained its gains against the US dollar, to record its highest level in more than two months in recent dealings.
The Egyptian currency recorded a slight increase against the American green card, as the dollar was traded at the exchange level of 15.88 pounds in a large number of Egyptian banks, which is the highest level of the Egyptian currency since the beginning of last June.
The Monetary Policy Committee of the Central Bank of Egypt had kept interest rates unchanged at its meeting on Thursday for the fourth time in a row, according to a statement from the bank (BDF). The bank kept the overnight deposit rate at 9.25%, the lending rate at 10.25%, and the principal operation and credit and discount rate at 9.75%.
The committee attributed its villages to the weak global economic activity and the state of uncertainty despite the easing of the embargo measures associated with the repercussions of “Covid-19”, in addition to the decline in the annual general inflation rate in Egyptian cities during July to 4.2%. The central bank decided, in an emergency meeting last March, to make a historic cut of the interest rate by 300 basis points.
At the same time, the Central Bank of Egypt seeks to maintain the flow of foreign investments to the country after a large part of it emerged in a global selling wave between March and May. Foreign investments returned during June after the government obtained financing from the International Monetary Fund, and their investments in Egyptian treasury bills reached about $ 14 billion by the end of July from 10.6 billion in the previous June.
According to Bloomberg, the Egyptian interest rate is the highest among 50 major economies. “In spite of the return of the flow of funds to the Egyptian market during the past weeks, expectations of the exit of funds internationally are still valid,” said Paul Greeren, Financial Director of Fidelity International.
He explained that the Central Bank of Egypt will continue to focus on maintaining the stability of the currency and healthy and positive interest rates.
The Central Bank of Egypt indicated in a recent statement that economic recovery rates have begun to appear despite the impact of the “Covid-19” pandemic and the accompanying precautionary measures. He pointed out that the real growth rate of the gross domestic product reached 8.3% during the fiscal year 2019/2020, compared to 6.5% during the first half of the same year.
He pointed out that a number of initial indicators began to trend towards recovery in June and July of 2020, coinciding with the start of the gradual easing of the precautionary measures.
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