Egyptian Pound Slides Further as Dollar Nears EGP 55 and Growth Forecasts Are Cut

The Egyptian pound weakened further on Tuesday, 31 March, as the US dollar continued to hover close to the EGP 55 level in parts of the banking system, with regional tensions and broader pressures on trade supply chains weighing on market sentiment. 

Data compiled from several banks at the close of business showed the dollar trading at up to around EGP 54.8 for buying and EGP 54.9 for selling at institutions including Suez Canal Bank and National Bank of Kuwait, compared with Monday’s higher end levels of roughly EGP 54.5 for buying and EGP 54.6 for selling.

Other lenders quoted narrower spreads in the range of approximately EGP 54.5 to 54.53 for buying and around EGP 54.6 for selling, suggesting broadly aligned pricing across the system. 

At the Central Bank of Egypt (CBE), the dollar was quoted at EGP 54.5 for buying and EGP 54.66 for selling, largely unchanged from Monday, with only marginal movement. 

Alongside the dollar, other major currencies showed mixed performance. The euro rose to around EGP 62.67 for buying and EGP 62.8 for selling, while sterling also increased slightly to about EGP 72.18 for buying and EGP 72.37 for selling. 

Gulf currencies were broadly steady, including the Saudi riyal and UAE dirham, while the Kuwaiti dinar recorded a modest rise within a tighter band.

The pound weakened further as Egypt revised its economic outlook, cutting growth forecasts due to rising Middle East tensions. Early in the week, the dollar pushed above 54 pounds and moved toward 55. Exchange rates also differed by bank, with rates varying across institutions in both the Gulf and Egypt.

Egypt’s growth forecast was cut because the Iran-related conflict is expected to hurt consumption, raise inflation, and increase import costs. 

The outlook also includes external-account developments. The International Monetary Fund (IMF) expects Egypt’s current account deficit to decline toward about 3 percent of GDP, supported by structural reforms aimed at boosting non-oil exports and restraining import growth, along with a gradual recovery linked to the Suez Canal and partial improvement in hydrocarbon output. 

At the same time, the IMF projected that inflation should continue easing gradually toward the central bank’s medium-term targets, even as short-term pressure remains elevated.