Question

In: Economics

I need a really detailed answer Egyptian Pound went through some volatility since it was floated...

I need a really detailed answer

Egyptian Pound went through some volatility since it was floated in November 2016 until today. This could be broken down in 4 main phases as follows:

Phase 1: From floatation till June 2018

Phase 2: From June 2018 - December 2018

Phase 3: From January 2019 - February 2020

Phase 4: Coronavirus worldwide outbreak

what happened during each of the above 4 phases and in full details how these factors impacted the EGP exchange rate versus the Dollar?

Solutions

Expert Solution

Solution :

Less than a week after the currency float decision, the Egyptian Exchange (EGX) hit a five-year high. Foreign investors and institutions, including Gulf-based investors, were on the buying side, merely locals and retail investors were sellers. This is a quick and strong sign of a renewed confidence that international and regional investors have in Egypt as an economy. It is apparent that undoubtedly large growth is expected over the long term, bolstered by a free economic system.

Undoubtedly, in the simplest terms, Egypt has become a more affordable destination than before - be it as a travel or investment destination. Both will lead to an inflow of foreign currency and Foreign Direct Investment (FDI) into the market and increased economic activities (reducing unemployment, increasing GDP, etc). There is a time lag, however, as investors will only start coming once they feel that the USD: EGP rate has reached stability and that the speculation/high volatility period is coming to an end.

The EGP is currently trading at close to EGP 16 to the dollar having appreciated 16% this month. Although further volatility is expected in the short term, it is expected to strengthen further and reach its fair value over the medium term. The IMF also expects inflation to drop in the second half of the year and push down interest rates to permit credit recovery.

Experts anticipate that the worldwide spread of the novel coronavirus will increase the US dollar’s exchange rate against the Egyptian pound. Economist and stock market expert Wael al-Nahhas said that the virus’s impact on Egypt is the same as the rest of the world. Investment banks also described fears of the negative impact of indirect investments exiting from emerging markets, including Egypt, up until control of the coronavirus expected to occur this summer.


Related Solutions

I need a really detailed answer Egyptian Pound went through some volatility since it was floated...
I need a really detailed answer Egyptian Pound went through some volatility since it was floated in November 2016 until today. This could be broken down in 4 main phases as follows: Phase 1: From floatation till June 2018 Phase 2: From June 2018 - December 2018 Phase 3: From January 2019 - February 2020 Phase 4: Coronavirus worldwide outbreak what happened during each of the above 4 phases and in full details how these factors impacted the EGP exchange...
The Egyptian Pound (EGP) went through some volatility since it was floated in November 2016 until...
The Egyptian Pound (EGP) went through some volatility since it was floated in November 2016 until today. This could be broken down in 4 main phases as follows: Phase 1: From floatation till June 2018 Phase 2: From June 2018 – December 2018 Phase 3: From January 2019 – February 2020 Phase 4: Coronavirus worldwide outbreak Required: Analyze what happened during each of the above 4 phases and explain in full details how these factors impacted the EGP exchange rate...
The answer is B, but I really need a detailed explanation for this. Equal volumes of...
The answer is B, but I really need a detailed explanation for this. Equal volumes of the following pairs of solutions are mixed. Which pair will produce a buffer solution? A. 0.10 mol L-1 HCl and 0.05 mol L-1 NaOH B. 0.10 mol L-1 HCl and 0.15 mol L-1 NH3 C. 0.10 mol L-1 HCl and 0.05 mol L-1 NH3 D. 0.10 mol L-1 HCl and 0.20 mol L-1 CH3COOH E. 0.10 mol L-1 HCl and 0.20 mol L-1 NaCl
I went to the 99 Cent store the other day and got really excited at some...
I went to the 99 Cent store the other day and got really excited at some amazing bargains: The scented candles that normally sold for $5.99 at Target was at the 99 Cent Store. After grabbing about a dozen of them and stuffing them into my shopping basket, I realized they weren’t 99 cents! They were marked as $1.99. I was a little annoyed and not a little disappointed as I mumbled to myself, “the audacity of them to keep...
I went to the 99 Cent store the other day and got really excited at some...
I went to the 99 Cent store the other day and got really excited at some amazing bargains: The scented candles that normally sold for $5.99 at Target was at the 99 Cent Store. After grabbing about a dozen of them and stuffing them into my shopping basket, I realized they weren’t 99 cents! They were marked as $1.99. I was a little annoyed and not a little disappointed as I mumbled to myself, “the audacity of them to keep...
please answer the following detailed in a paragraph. I am really struggling with this concept. thanks!...
please answer the following detailed in a paragraph. I am really struggling with this concept. thanks! Microorganisms can thrive under many different conditions, including high-temperature environments such as hot springs. To function properly, cell membranes have to be in a fluid state. How do you expect the fatty acid content (saturated versus unsaturated) of bacteria living in high-temperature environments might compare with that of bacteria living in more moderate temperatures? 2. Heating a protein sufficiently may cause it to denature....
(I have posted this question three times without any answer! please answer it. I really need...
(I have posted this question three times without any answer! please answer it. I really need the answer) Using openERP open-source (Odoo 10) systems, you will have to build HR & Finance business processes into the system. You will have to build ( a University or any company of your choosing) HR business processes using one of the tool you found interesting. You will have to find out improvements of the process Add the business rules to the processes You...
Why a linear spectrum is observed after hydrogen atom ionization? Please I need really detailed description....
Why a linear spectrum is observed after hydrogen atom ionization? Please I need really detailed description. May be some examples in nature, some schemes and some description based on basic relations. I want to understand it very well.
Explain five work assignments of Public Relations. i need detailed answer
Explain five work assignments of Public Relations. i need detailed answer
what are the differences and similarities between Gluconeogenesis and Glycolysis , I need a detailed answer...
what are the differences and similarities between Gluconeogenesis and Glycolysis , I need a detailed answer please?
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT