The USD to EGP exchange rate has recently been shaped by several market developments and forecasts. As of late September, the USD has shown resilience, rebounding from losses tied to the Federal Reserve's September policy meeting. Analysts suggest that the stronger demand for the USD may persist due to an optimistic market sentiment surrounding geopolitical developments, such as the peace talks related to Gaza. However, upcoming economic data, including the University of Michigan’s consumer sentiment index, could threaten this strength if negative sentiment is reported.
Several factors are influencing the US dollar. The ongoing transition in Federal Reserve leadership and critical inflation data due out soon are key considerations. The U.S. Consumer Price Index is anticipated, with expectations of a modest rise in core prices, which could impact the monetary policy stance of the Fed. Furthermore, developments in US-China trade negotiations and trends toward dedollarization affect the USD's long-term outlook, as countries seek alternatives to the US dollar amidst fluctuating U.S. economic policies.
On the other hand, the Egyptian Pound has been under noteworthy pressure. The Central Bank of Egypt's recent decision to cut interest rates for the fourth time this year by 100 basis points demonstrates a shift towards easing monetary policy amidst declining inflation rates. Analysts report that the decline in headline inflation from a peak of 38.0% in September 2023 to 12.0% in August 2025 reflects improving economic conditions, yet the interest rate cuts may weigh on the EGP's strength against the USD.
The economic landscape in Egypt shows growth, with a reported 5.0% GDP increase in Q2 of 2025 driven by tourism and trade sectors. However, challenges such as foreign currency shortages and ongoing subsidy commitments also underscore the complexities facing the EGP. With the USD to EGP currently trading near 90-day lows at about 47.55, which is 1.9% below its three-month average, the exchange rate has been quite stable, contained within a 4.1% range.
Market forecasts suggest potential volatility ahead, influenced by both U.S. economic indicators and Egypt's monetary policy decisions. As such, stakeholders should closely monitor upcoming data releases and geopolitical developments to make informed decisions on international transactions.
