Despite the Central Bank of Egypt’s decision to raise Interest rates 2% during the last meeting of the Monetary Policy CommitteeThe exchange market is witnessing a state of calm and some stability.
On the dollar front, its prices stabilized at low levels compared to its highest peak following the Central Bank reduced its value once morest the dollar on March 21.
The dollar exchange rate once morest the Egyptian pound recorded 18.23 pounds for purchase, and 18.29 pounds for sale. While the European euro exchange rate recorded a level of 19.07 pounds for purchase, and 19.21 pounds for sale. The exchange rate of the pound sterling once morest the Egyptian pound reached 22.49 pounds for purchase, and 22.69 pounds for sale.
In the Arab world, the exchange rate of the Saudi riyal once morest the Egyptian pound stabilized at the level of 4.87 pounds for purchase, and 4.88 pounds for sale. The exchange rate of the UAE dirham was 4.96 pounds for purchase, and 4.98 pounds for sale. While the Kuwaiti dinar exchange rate reached 57.21 pounds for purchase, and 59.66 pounds for sale.
Last Thursday, the Central Bank of Egypt decided to raise the main interest rates by 200 basis points, as the Monetary Policy Committee decided to raise the interest rate on overnight lending to 12.25% from 10.25%. It also increased the overnight deposit rate to 11.25% from 9.25%.
In the gold market, following gold prices fell by regarding 250 pounds per gram during the past two weeks, gold prices rose once more by regarding 20 pounds during the recent trading.
The 18 caliber recorded a level of 873 pounds per gram, while the 21 caliber recorded the level of 1020 pounds per gram. 24 carat recorded a level of 1162 pounds per gram, while the price of the gold pound reached 8160 pounds.
Forecasts for the performance of the Egyptian economy
With regard to the performance of the Egyptian economy, a Archyde.com poll of 23 economists conducted last April showed that the economy would grow by 2.9% in the fiscal year ending in June, and that growth would rise to 5% in the following year with the coronavirus pandemic receding. The return of tourists.
The expected figure for the 2020-2021 fiscal year is slightly higher than what Finance Minister Mohamed Maait had forecast on April 5, and economists in a Archyde.com poll three months ago forecast growth of 2.8%.
The consensus forecast in April is well below the 6 percent growth forecast before the outbreak of the coronavirus pandemic.
“We expect declining tourism to be the main drag on the economy in FY20-21, which will dampen consumption and private investment,” said Garbis Iradian, chief economist for the Middle East and North Africa at the Institute of International Finance.
Central bank data showed that COVID-19-related travel restrictions reduced tourism revenue to $1.8 billion in the second half of 2020 from $7.2 billion a year earlier.
Iradian said government investment will be the main driver of growth this year.
“We expect it to shrink next year, while private investment rebounds in the wake of a recovery in tourism, with a positive impact extending to private consumption,” he added.
Economists in the survey, which was conducted between April 8-20, expected a further recovery in economic growth to 5.5% in 2022-2023.
