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MP Mohamed Fouad Notes $1.8B Exit and End of Wooden Dollar
The article focused on the reasons behind the fluctuations in the US dollar exchange rate against the Egyptian pound in recent months. Economist and MP Mohamed Fouad explained that the phenomenon of "wooden dollar," which once dominated the market, has disappeared, and the exchange rate is now more influenced by economic factors and hot money inflows. He pointed out that the withdrawal of nearly $1.8 billion in March, due to regional tensions such as the Iranian conflict, led to a decline in the value of the pound and an increase in the dollar's rate. Additionally, he clarified that Egypt follows a flexible exchange rate system based on supply and demand, and employs high interest rates to attract investments. However, the outflow of hot money during tense events exerts pressure on the local currency. He concluded that the movement of capital outflows is related to political and regional risks, making the exchange rate a reflection of economic and political tensions in the region.
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