The Egyptian pound weakened against the dollar, tracking the euro’s decline against the US currency to a four-year low.
"What is happening is a reflection of what is happening with the European sovereign debt crisis. All the moves in the EGP in the past month were only following Europe," a forex trader at an Egyptian bank said.
Egypt’s net foreign reserves rose to $35.1 billion at end-May, exceeding levels reached before the 2008 global economic crisis.
"Higher reserves mean they have some room to strengthen the currency when they need to. We are in a better position to finance our debt," the trader said.
The low euro has raised concerns Egyptian exports and Suez Canal remittances could be hurt, traders said. The pound trades at 5.6740 to the dollar, vs 5.6690 on Sunday.
