Egyptian pound weakens past 53 per dollar, lowest level since May

The dollar closed Wednesday at 53.18 Egyptian pounds , marking the highest level for the US currency since May 19, according to Central Bank of Egypt data.

“Rising global energy prices could be a catalyst for increased dollar demand in Egypt,” Mosaic Economics analyst Ali Metwally told Al Manassa, explaining the currency’s recent rise.

Global energy price hikes directly impact Egypt as a net importer of petroleum products. The balance of payments for the fiscal year ended in June revealed a 31.5% widening of the petroleum trade deficit compared to the previous year, driven by higher import volumes of natural gas and crude oil.

Global oil prices have fluctuated sharply since the escalation of the US war on Iran. Brent crude futures have exceeded $100 per barrel since early October, reaching a high of $107.15 in Wednesday trading amid mounting concerns following an Ansar Allah (Houthi) strike on a Saudi Aramco facility.

Metwally noted a potential decline in foreign investors’ risk appetite, which could prompt them to reduce exposure to emerging-market debt or delay new investments, even as foreign purchases of Egyptian treasury bills continue.

Foreign investors recorded net sales of treasury bills on the Egyptian Exchange on Wednesday amounting to 5.8 billion pounds ($109 million).

Prime Investment macroeconomic analyst Mina Rafik said that the dollar’s rise may be driven by foreign investor outflows from the Egyptian market due to fears of escalating regional geopolitical tensions.

“Higher interest rates on US bonds and expectations that the Federal Reserve will continue hiking rates, combined with forecasts that the Central Bank of Egypt will hold its rates steady during its upcoming 2026 meetings, may push investors to exit the market,” Rafik added.