By Inaam Al-Adawy
The presidential election has cast its shadow on the local exchange market, pushing the dollar to relative stability amidst expectations that it will fall with the announcement of the election result and the subsequent stabilization of the political situation.
Ali Al-Hariri, Deputy of Cair’so Chamber of Commerce Exchange Department, said that the presidential elections have resulted in a slowdown of the currency market in Egypt, which has led to exchange companies’ decision to close over the next two days awaiting the election result. Al-Hariri pointed out that dollar rates are witnessing clear stability, settling at EGP 6.4 purchase and EGP 6.5 sale. He added that the Euro witnessed a noticeable jump to EGP 7.60 purchase and EGP 7.65 sale, rising nearly 10 piastres compared to last week’s close.
Al-Hariri also noted that the pound sterling has risen by almost 10 piastres since the beginning of the week, reaching EGP 9.5 purchase, above last week’s close of EGP 9.4, and EGP 9.6 sale versus EGP 9.5. He added that despite the companies’ closing, their owners had undertaken security measures against armed robberies like those witnessed two months ago, when millions of pounds were stolen from four exchange companies. They expect demand at these exchange companies to increase after the presidential elections, especially after the last two months’ slowdown, during which some of the companies withdrew their funds and deposited them in banks out of fear of similar robberies.
Al-Hariri expected dollar rates to fall to EGP 6 amidst exchange rate stability after the presidential elections. Member of the Giza Chamber of Commerce Exchange Department Sameh Abdul Rahman said that a decline in the dollar exchange rate depends on both political stability after the announcement of the presidential election results and the prevention of the rioting that the country has seen over the past year. He also pointed out that the stock market’s trading has cast a shadow on the currency market. Abdul Rahman added that the increase in selling on last Monday and Tuesday led to a complete slowdown in the exchange market in the expectation of a rise in buying after the election of a new president. This will allow for increased security for banks and exchange companies, he said, as the absence of security in the streets has led to a rise in crime and, in light of these events, the continued increase of the dollar exchange rate in the near future.
Head of the Cairo Chamber of Commerce Exchange Companies Department Mohammad Al-Abyad emphasized that there is no doubt that the presidential elections will contribute to the return of stability to the country and the increase of dollar resources locally, resulting from a rise in investment and the return of tourism. This should help significantly with the exchange rate, and therefore exchange companies’ business.
Al-Abyad stressed the necessity of restoring security and establishing control over this breakdown of law and order by deterring potential criminals, warning of an economic crisis and the deterioration of the economic situation. He emphasized that if there was no deterrence for these crimes, then the Egyptian economic situation would continue to worsen.