Economic expert Mohamed Fouad revealed the impact of the Central Bank of Egypt‘s (CBE) recent decision to reduce interest rates on the exchange rate of the US dollar against the Egyptian pound.
During a phone interview with TV host Amr Adib on the “al-Hekaya” (The Story) show on Friday, Fouad said that despite the interest rate cut, Egypt remains one of the countries with the highest interest rates.
He added that it is also the most stable compared to other countries such as Argentina and Turkey, which are currently experiencing some severe turmoil.
The dollar’s amount decreases when investors say that Egypt doesn’t pay much interest, he explained, and they go and take their dollars and leave, but he assured that this is not happening now.
Fouad explained that the global market places interest rates in Egypt at lower than the current rate.
“The current interest rate is comfortable. It’s not the rate that puts pressure on the currency, causing people to withdraw their dollars, and this withdrawal is what raises the dollar’s value,” he continued.
Reducing interest rates will not lead to an increase in the price of the US dollar against the Egyptian pound in the Egyptian market, the expert added.
