Egypt’s currency edges higher against the US dollar after price hikes

CAIRO — The Egyptian pound is falling against foreign currencies, inching closer to 50 per US dollar after a recent increase in subway fares and fuel prices.

The currency hit 49.16 per US dollar on Tuesday, the Central Bank of Egypt published in its website.

In June and July, the Egyptian pound fluctuated between 47 and 48 per dollar after having traded in March and lost about 60% of its valueup to about 30 to the dollar.

The new exchange rates come a week after the International Monetary Fund (IMF) completed its third financial review of Egypt, which allowed the government to withdraw $820 million. that amount is part of $8 billion bailout loan intended to support Egypt’s weakened economy, slowed by a shortage of foreign currency, skyrocketing inflation and turmoil in the Red Sea due to attacks by Yemen’s Houthi rebels.

“Recent efforts by the Egyptian authorities to restore macroeconomic stability have begun to yield positive results. Inflation remains high but is falling. A flexible exchange rate regime remains the cornerstone of the authorities’ program,” he stated. The IMF said last week.

Egyptians have struggled with soaring inflation, including an announcement late last month by The Oil Ministry said fuel prices would rise by about 10%..

The latest fuel price increase. it happened in march The government attributes the price increases to rising fuel costs due to attacks in the Red Sea and the depreciation of its currency.

The Houthis have been attacking commercial ships. in the Red Sea in retaliation against Israel’s ongoing war in Gaza. Oil, natural gas and grain, among other products, travel through the sea routes separating Africa and the Arabian Peninsula en route to the Suez Canal, through which 12% of world trade normally passes.

Metro fares in Cairo also officially increased as of last week, according to the National Tunnel Authority, which manages and operates the Cairo metro. The increase in fare prices now ranges between 2 and 5 Egyptian pounds.

Egypt reached an agreement with the IMF this spring to more than double the size of its bailout to $8 billion. Price increases have been deemed necessary to Comply with the conditions established by the IMF. for more help to the country.