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Egyptian Pound Hits Five-Year Low Against US Dollar

The Egyptian pound recorded its lowest level in five and a half years, after falling 0.05% during Monday’s trade. (AFP)
The Egyptian pound recorded its lowest level in five and a half years, after falling 0.05% during Monday’s trade. (AFP)
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Egyptian Pound Hits Five-Year Low Against US Dollar

The Egyptian pound recorded its lowest level in five and a half years, after falling 0.05% during Monday’s trade. (AFP)
The Egyptian pound recorded its lowest level in five and a half years, after falling 0.05% during Monday’s trade. (AFP)

The Egyptian pound dropped to its lowest level in five and a half years, after falling 0.05% during Monday’s trade.

Refinitiv data showed that the pound traded 18.91 to the dollar, down from 18.81 pounds on Sunday.

The last time the currency reached that level was on January 24, 2017.

Egypt's central bank raised its key interest rates by 100 basis points in an exceptional monetary policy committee meeting on March 21.

The pound has been affected by an increased demand for dollars by importers. Indirect foreign investments have been pulling out of the country after the US Federal Reserve raised interest rates.

Cairo is facing a number of economic and social challenges.

Its tourism sector has been affected by Russia’s war on Ukraine. Russian and Ukrainian tourists account for almost a third of total of visitors.

This coincided with the surge in global energy and food prices, which are the drivers of inflation in the country.

Separately, Egypt’s General Authority for Supply Commodities (GASC) announced a tender to receive imported wheat from five countries: the United States, Canada, Australia, Argentina, and Brazil.

The opening session of the tender will take place on Tuesday, while the deciding session will be held on July 20, the authority said.

Importers can submit their offers based on cost and freight (C&F), as well as paying with 180-day suppliers facilities, it added.

The shipments will be charged in four periods from September 16 to 30, October 1 to 15, October 16 to 31, and November 1 to 15.

Bidders can apply for all or one of the shipping periods, the GASC noted.

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Business

US Job Growth Surges in September, Unemployment Rate Falls to 4.1%

A woman enters a store next to a sign advertising job openings at Times Square in New York City, New York, US, August 6, 2021. REUTERS/Eduardo Munoz/File Photo
A woman enters a store next to a sign advertising job openings at Times Square in New York City, New York, US, August 6, 2021. REUTERS/Eduardo Munoz/File Photo
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US Job Growth Surges in September, Unemployment Rate Falls to 4.1%

A woman enters a store next to a sign advertising job openings at Times Square in New York City, New York, US, August 6, 2021. REUTERS/Eduardo Munoz/File Photo
A woman enters a store next to a sign advertising job openings at Times Square in New York City, New York, US, August 6, 2021. REUTERS/Eduardo Munoz/File Photo

US job growth accelerated in September and the unemployment slipped to 4.1%, further reducing the need for the Federal Reserve to maintain large interest rate cuts at its remaining two meetings this year.
Nonfarm payrolls increased by 254,000 jobs last month after rising by an upwardly revised 159,000 in August, the Labor Department's Bureau of Labor Statistics said in its closely watched employment report on Friday.
Economists polled by Reuters had forecast payrolls rising by 140,000 positions after advancing by a previously reported 142,000 in August.
The initial payrolls count for August has typically been revised higher over the past decade. Estimates for September's job gains ranged from 70,000 to 220,000.
The US labor market slowdown is being driven by tepid hiring against the backdrop of increased labor supply stemming mostly from a rise in immigration. Layoffs have remained low, which is underpinning the economy through solid consumer spending.
Average hourly earnings rose 0.4% after gaining 0.5% in August. Wages increased 4% year-on-year after climbing 3.9% in August.
The US unemployment rate dropped from 4.2% in August. It has jumped from 3.4% in April 2023, in part boosted by the 16-24 age cohort and rise in temporary layoffs during the annual automobile plant shutdowns in July.
The US Federal Reserve's policy setting committee kicked off its policy easing cycle with an unusually large half-percentage-point rate cut last month and Fed Chair Jerome Powell emphasized growing concerns over the health of the labor market.
While the labor market has taken a step back, annual benchmark revisions to national accounts data last week showed the economy in a much better shape than previously estimated, with upgrades to growth, income, savings and corporate profits.
This improved economic backdrop was acknowledged by Powell this week when he pushed back against investors' expectations for another half-percentage-point rate cut in November, saying “this is not a committee that feels like it is in a hurry to cut rates quickly.”
The Fed hiked rates by 525 basis points in 2022 and 2023, and delivered its first rate cut since 2020 last month. Its policy rate is currently set in the 4.75%-5.00% band.
Early on Friday, financial markets saw a roughly 71.5% chance of a quarter-point rate reduction in November, CME's FedWatch tool showed. The odds of a 50 basis points cut were around 28.5%.