Wednesday 22 Jan
The American investment bank, Goldman Sachs, has predicted an increase in the value of the Egyptian pound against the US dollar in the near future. This forecast is driven by an anticipated surge in foreign capital inflows into Egypt.
In a recent memo issued during its visit to Egypt, Goldman Sachs stated that the Egyptian pound will appreciate against the US dollar and other foreign currencies in the coming period. While the bank did not provide specific figures, it highlighted the potential for increased "hot money" flows into Egyptian debt.
The bank noted that the factors
that led to significant outflows of investments from Egyptian debt during the
fourth quarter of the fiscal year have largely subsided. Since the beginning of
2025, Egypt has witnessed strong inflows of foreign currency, pushing the pound
up by 1.5%.
Goldman Sachs estimated foreign
investors' current holdings of domestic debt at $10 billion. The bank believes
this figure is low enough to accommodate substantial inflows of billions of
dollars in the coming period, further supporting the pound's appreciation
forecast.
The bank also downplayed the
impact of large treasury bill maturities scheduled for March. The selling wave
that occurred during the last quarter has already resulted in a significant portion
of this debt being held by local investors.
Furthermore, Goldman Sachs emphasized the positive impact of the current economic team's "different mindset" and improved coordination in the policy-making process. This, according to the bank, creates a more favorable environment for economic growth and stability.
