CAIRO: The US dollar is picking up speed after almost two years of depreciating against the Egyptian pound.
Over the past few days, the purchase value of the dollar increased to reach LE 5.534, a LE 0.05 rise from last week s LE 5.482. The selling value is at LE 5.55, up from last week s LE 5.50.
Last week, exchange points experienced heavy dollar transactions after news spread in Cairo that the currency would climb upwards. An employee working at a currency exchange office in Heliopolis told Daily News Egypt that he had to buy US dollars from the bank to meet the increasing demand for the hard currency.
We expect the dollar will continue to rise until it reaches LE 6, just like it was two years ago, Maged Helmi, a former banker and financial consultant at Prime Securities, told Daily News Egypt.
The strengthening of the dollar against foreign currencies can be attributed to a number of factors. Last Thursday, the US Congress approved an economic stimulus package and the Federal Reserve announced a 75 basis point cut in its benchmark interest rate, bringing it down to 3.5 percent.
These move is an attempt to boost the US economy, as the benchmark rate cuts will encourage investors and restore their faith in the slumping American economy.
The US needs to help their currency against the euro, which has become the most powerful currency in the world, surpassing the dollar that was once indispensable, Helmi said.
Because of the recession the US economy s has experienced over the past year, investors have preferred to conduct their transactions using the euro, he explained.
Thursday s announcement led to a decrease in the Euro against the dollar, down to $1.4680 from $1.4756.
The Egyptian economy s performance and the Central Bank of Egypt will put up a strong fight before they allow the US dollar to reach to LE 6 again, he said.
