
The Egyptian pound rose 3.9% against the dollar over the past week as foreign portfolio investments returned to local debt, with estimates of inflows ranging from $2 billion to $2.5 billion. Analysts also pointed to improved global risk appetite, lower oil prices and a recent 100-basis-point increase in Egypt’s policy rates.
Portfolio inflows and lower oil prices can ease pressure on Egypt’s foreign-currency availability, supporting the pound and reducing the local-currency cost of imported feed and inputs. The gains may be vulnerable if foreign investment flows reverse.
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