CAIRO -
On the impact of speculations about the dollar, gold and pound, Egyptians woke up Thursday morning to discussions and economic expectations, which overshadowed the calm atmosphere on the occasion of the blessed Eid al-Fitr holiday.
The "Egyptian pound" label was issued on social media after the US Federal Reserve announced the interest rate hike, amid expectations of a new decline in the Egyptian currency, as the dollar price is currently about 18.5 Egyptian pounds, after it was within 15.7 pounds.
Despite the absence of an official decision from the Central Bank of Egypt, the pioneers of communication sites expected a new rise in the price of the dollar, which would increase the suffering of Egyptians who are already facing an inflationary wave and a continuous rise in prices.
These negative expectations prompted activists to interact also by calling the dollar and gold, as some talked about the dollar’s control over the Egyptian and global economy, while others spoke about the need to buy the dollar or gold in anticipation of the expected drop in the pound’s price.
Tweeters considered that the state of anxiety that dominated social networking sites about the future of the pound indicates a state of pessimism that dominates the economic climate in Egypt, which calls for government intervention and a change in policies to confront the expected crises.
Why is everyone in #Egypt concerned about the news of the #interest_rise in the #USA?
And why do they expect to reduce the price of the Egyptian pound against the dollar?
And why did the Egyptians demand for gold so scarce?
This pessimistic climate is in itself a referendum on confidence in the Egyptian economy, and the Egyptian regime must change its policies immediately.
pic.twitter.com/Y1YETHgxM1
— Mourad Aly Dr.
Murad Ali (@mouradaly) May 5, 2022
#gold
#dollar We bought 44 tons of gold before the Russian-Ukrainian crisis and #Egypt doubled the gold reserves and our type in our cash reserves
{
dollars, euros, Chinese yuan, sterling, Japanese yen.
pic.twitter.com/u9PDVm5yeo
— ✌️ 🇪🇬 🇪🇬 Abbass Elmohandes 🇪🇬 🇪🇬 ✌️ (@AbbassElmohand1) May 4, 2022
People who have money will go crazy and terrified over their money and its value, which is decreasing . Praise be to God. I do not have money. I am not afraid of it, nor do I prefer to stay awake all night. I change my money to a
dollar
or gold, and I do not invest it in anything and focus on me #dollars
— hamed054 (@metrhamed) May 4, 2022
The dollar
for the 1,000th time, those who ran and bought the certificates of the 18% will incur huge losses because the inflation rate continues to rise insanely because the state is unable to do any economic activity that supports the national currency..the value of your certificates is decreasing daily.
- Abu Swailem (@freedom_tous) May 3, 2022
suggestions and steps
For his part, Mustafa Abdel Salam, an expert in economic affairs and journalistic writer, offered several advice to the Egyptian government to deal with the upcoming crisis, pointing to the possibility of limiting the negative effects of raising interest rates in the United States.
Through his account on Facebook, Abdel Salam called on banks to speed up filling ATMs with money to reassure people, and called not to rush to buy dollars by individuals and savers without necessity, and to deposit dollars in banks, and not to rush to buy goods, and to boycott goods whose price increases and preference for the local product.
He pointed to the need to form a professional and independent economic group to manage the economic file away from the current government and any political pressures, provided that what it reaches is implemented immediately, while leaving the task of managing monetary policy to the central bank without political interference, and the central bank takes quick steps to reassure the market and dealers. with banks.
Abdel Salam pointed out the importance of reducing the customs dollar and freezing the value-added tax temporarily until prices calm down, while offering attractive savings containers to those dealing with banks with a return that exceeds the real and not declared inflation, in order to limit the return of the dangerous dollarization phenomenon to the economy and the exchange market.
The writer specialized in economics concluded by saying that the most prominent steps are to curb external borrowing, which is the main cause of the crisis that the country is currently going through.
gold prices
In conjunction with the rise in its price globally, gold prices in Egypt recorded new and unprecedented levels at the beginning of trading today, Thursday, after the Federal Reserve (the US Central Bank) raised the interest rate to curb inflation, which the Central Bank sees as a factor threatening the economy.
And the gold prices came, according to Egyptian media, as follows:
The price of 24 karat gold is about 1332 pounds.
The price of 21 karat gold is about 1165 pounds.
The price of 18 karat gold is about 999 pounds.
The price of the gold pound is 9930 pounds.
The Central Bank of Egypt had purchased about 44.4 tons of gold during the period from January to March 2022, bringing Egypt's gold reserves to 125 tons, compared to about 81 tons in January 2021, according to the quarterly report. Issued by the World Gold Council on April 28.
Central gold purchases came in conjunction with the decline in foreign exchange reserves by 4 billion dollars, as the foreign exchange reserves decreased to about 37 billion dollars in March 2022, compared to 40.9 billion dollars in February of this year.
The purchases sparked controversy among experts about their timing and feasibility, as some of them said that it was a wrong move due to the high gold prices and the country's need for the dollar now, as well as expectations of a decline in gold prices.
But others said that the source of the gold obtained by the Central Bank was Egypt’s share in the Sukari mine, and that Egypt took advantage of a clause in the contract that grants it in certain cases the right to obtain its share for a period of one year at once, and therefore did not buy gold in dollars, as others said that some of the That quantity came from the local market by collecting a large part of the raw gold in the markets and destined for export abroad, and buying it in the local currency.
In press statements, financial market expert Ahmed Moati said that the appropriate time to buy gold is always at the beginning of a major global crisis, or at the end of a global crisis, because it is known that gold is a safe haven in times of crises, explaining that there is no fear at all that prices will decline. Gold is as expected, because in the worst case scenario, which is a decline in global gold prices, it will rise again.
Today, Thursday, the Egyptians were preoccupied with the pound, the dollar and gold, as a continuation of their preoccupation with the economic crisis that the country is going through, which threatens the 8-year course of what the Egyptian government describes as economic reform, in light of the Russian war on Ukraine, and the resulting negative economic effects.
It seems that this prompted President Abdel Fattah El-Sisi to announce a package of economic decisions to confront the crisis, which he announced during the Egyptian family's Iftar party in the last week of Ramadan, the most prominent of which were as follows:
Assigning the government to announce a program for private sector participation in state-owned assets with a target of $10 billion annually for a period of 4 years.
Assigning the government to enhance all aspects of support provided to wheat farmers.
Launching an initiative to support and localize national industries.
Offering stakes from state-owned companies in the Egyptian Stock Exchange before the end of this year.
Presentation of shares of military-owned companies in the stock exchange.
Strengthening the role of the private sector in expanding the industrial base of large and medium industries.
Assigning the government to present an integrated vision for the advancement of the Egyptian Stock Exchange.
Assigning the government to hold an international press conference to announce the Egyptian state's plan to deal with the global economic crisis.
The #Federal raised today half a point, this means that the #dollar will remain at 20 pounds 😱
The catastrophe is that it is expected at the end of the year that the interest rate will be raised to 2.5% 😱
May God have mercy on the #Egyptian_fairy #Sisi killed him and saved him sincerely #Leave
- Free Egyptian Girl (@Pent4Egy25) May 4, 2022
Any change in the value of the dollar is offset by the depreciation of the pound, as if the Egyptian pound since 1952 knows only the way to decline
, right, and I am not senile!!
pic.twitter.com/7X9jOWpFaE
— Freedom (@El_naggar4) May 4, 2022
Raising the interest on the Egyptian pound is not as simple as this is what they are talking about, and it will increase the burden of debt servicing on the Egyptian government, so the decision must be well calculated.
5- I am saying from now on, is it: Make your account that the disruption of supply and supply chains coming from China will continue at least until the end of 2022, (7-10)
— Mohamed Anis (@manis228) May 5, 2022
The US central bank raises the interest rate by 0.5%, which is the largest increase in 22 years
Clacket again # Egyptian_pound = 🤔 pic.twitter.com/3MCM8UN9Ac
— blue bird (@mzajnjy11) May 5, 2022
All of them actually came out in the first lift, and Sisi took direct investments from the Arab Gulf countries, so there is no hot money or indirect foreign investments in Egypt at all. Their exit would require the government to provide dollars for them,
so there is no reason to reduce the value of the Egyptian pound or to make a new certificate 4
— Mohamed ahmed ahmed (@KaledMohamedah1) May 5, 2022
A group, because of the mess and the lot of anxiety
who has more money than his needs (and put a line under the word extra) Oh, buy
#dollars, buy #dahab, and
my advice is to invest in gold and the dollar, if its price goes down, I mean any other currency (and I doubt that) it has nothing to do with the Egyptian pound
The pound will then depreciate the dollar's value
— Hassan Elkhouly (@7assanEl5ouly) May 5, 2022
America has raised the interest, the Gulf has raised the interest, Europe will raise the interest, in the possibility that Egypt will raise the interest again after the Eid holiday.
— Ehab W. (@Ehab_ElSaid9) May 5, 2022
#Egyptian_pound
We have confidence in the Egyptian economy and we do not accept the intimidation and analyzes of social media sites and their exaggeration of things. If there is harm to countries, Europe will be more harmful than the Arab countries. Praise be to God for the blessing of Egypt or the world, and the Egyptian pound is one of a thousand works around the world.
pic.twitter.com/9K7tHLRj13
— Abu Hashem Al-Hashmi 🇪🇬🇸🇦🇪🇧🇭 (@Abohashem2222) May 5, 2022
One of the most difficult conditions of the International Monetary Fund for the regime is the story of disclosing the accounts of army companies, because it is impossible for the army to reveal its accounts, not to the IMF, but to any international accounting company that reviews its accounts and confirms the preparation of budgets according to international accounting standards.
#Egyptian_pound #USFederal #Great_Eid
— Youssef Mohamed (@Youssefmhod) May 5, 2022