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The dollar is today and the dollar will continue to fall? We will answer this question through this report: an earthquake that should not affect the dollar and exchange rates against the Egyptian pound, which began to rise from its fall. The highest price in 24 months, but the most important question now is whether this trend holds or whether the dollar price forecast will change this trend in US dollars (economic analysts are divided. that the downward trend of the dollar will continue.See the contrary, and that what has happened does not reflect the actual expectations of the price of the green card on the Egyptian market, and these two expectations are justified by logical reasons.
We must therefore prepare this summary and comprehensive report on the dollar price outlook for the coming period, analyzing the views expressed in this regard, by examining impartially and objectively the factors of weakness and strength of the pound. sterling against the dollar and the basket of foreign and Arab currencies.
First of all, there are many opinions that the Egyptian pound will continue to rise against currencies and the factors favoring the continuation of the upward trend of the pound against the dollar and the basket of other currencies. , the most important of these factors.
Factors of the strength of the Egyptian pound against the dollar and currencies
The increase in foreign currency inflows into the Egyptian economy is due to the improved income from Egyptian tourism and the significant increase in Egyptian exports, as well as the Increasing remittance rates of Egyptians abroad which have reached record levels in recent years
The increase in the demand for investment in Egyptian debt securities and Treasury bills from foreign traders, which pursue the greatest benefits offered by central banks around the world. The improvement of the balance of payments in Egypt has a significant impact on the increase in demand for this type of indirect investment in debt securities, on the Egyptian economy.
Foreign direct investment has slightly increased Egypt hoped that foreign direct investment would be the most important factor of the strength of its economy, but the "loan and discount" rate High interest limits and prevents the increase of foreign direct investment. Bank financing limits are not supported by new projects.
The strength of the Egyptian pound against the dollar and other foreign currencies lies in self-sufficiency in Egyptian natural gas, with Egypt ceasing to import its natural gas after recent discoveries of natural gas, which began export its surplus natural gas. To import gas, nearly $ 3 billion a year has been spent on the import of natural gas.
Egyptian Foreign Minister Mostafa Madbouli said that foreign currency inflows into Egypt in the last three years had reached 163 billion euros. Despite Madbouli's comments, investing in hot money in debt instruments is a major pillar of inflows. Foreign exchange on Egypt, and here is the risk.
Exchange rate of the US dollar and all the foreign and Arab currencies of the Central Bank
| Currency | Buy | To sell |
|---|---|---|
| American dollar | 17.2300 | 17.3544 |
| Euro | 19.5629 | 19.7077 |
| £ | 22.8745 | 23.0467 |
| Canadian dollar | 12.9422 | 13.0406 |
| Danish Crown | 2.6218 | 2.6409 |
| Norwegian Krone | 2.0200 | 2.0353 |
| Swedish crown | 1.8707 | 1.8847 |
| Swiss franc | 17.2283 | 17.3562 |
| 100 JPY | 15.4821 | 15.5967 |
| SAR | 4.5942 | 4.6276 |
| KD | 56.7056 | 57.2282 |
| United Arab Emirates Dirham | 4.6903 | 4.7251 |
| Australian dollar | 12.2281 | 12.3199 |
| Bahrain Dinars | 45.7005 | 46.0379 |
| RO | 44.7509 | 45.0800 |
| Riyals from Qatar | 4.7316 | 4.7677 |
| Jordanian dinar | 24.2676 | 24.5119 |
| Chinese Yuan | 2.5664 | 2.5855 |
Factors weakening the Egyptian pound against the dollar and currencies
The most important negative factors on the price of the Egyptian pound against the dollar Due to Egypt's dependence on its foreign currencies on indirect investments in debt securities, this type of Investment may appear at any time in the arteries of the Egyptian economy and cause a sudden drought of criticism The increase in Egypt's external debt relative to historical levels puts pressure on the price of the pound and prevents its strength, especially with the date of repayment of the maturity of these loans and their benefits. Egypt is currently attempting to convert short-term borrowings into medium and long-term borrowings, while the other country has a central belly.
In addition, the main factor in the non-continuation of the upward trend of the pound sterling against the dollar is the rise in interest rates that prevent foreign investment from entering the country. Egyptian economy, where the direct economy corresponds to the real growth of any emerging economy. The jobs are permanent, it is about real growth.
According to the latest available data, foreign investment in government debt securities reached $ 14 billion at the end of September, compared to $ 17.5 billion at the end of June and $ 23.1 billion at the end of March 2018 .
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The Egyptian state has already begun to realize the risk of a persistent rise in interest rates, which has been reduced by 100 basis points for several weeks and the real investor hopes that this reduction will be the general trend of monetary policy from the central bank. The interest rate, which will accelerate the release of hot money by investing in debt instruments, but the reduction in the interest rate is more dangerous than that of hot money.
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