Pound falls to 6-year low after Egypt demos
Egypt’s stock market has tumbled over 4 percent a day after massive anti-government protests engulfed the capital and other cities, leaving three people dead.
The benchmark EGX30 index was down 4.63 percent, to 6,411.94 points by 10:45 a.m. local time Tuesday. Its year-to-date losses stand so far at over 10 percent.
The tumble came a day after tens of thousands of Egyptians took to the streets, clashing with police, in a protest modeled after the uprising in Tunisia that led to the toppling of that North African nation’s longtime leader.
Egyptians have grown increasingly frustrated with President Hosni Mubarak’s 30-year rule, arguing that economic gains have failed to trickle down and that the government has done little to address crippling poverty.
Egypt’s pound, meanwhile, fell to its lowest level against the U.S. dollar since January 2005 after the biggest anti-government protests of President Hosni Mubarak’s three-decade rule.
The pound fell as low as 5.830 against the U.S. currency after closing at 5.816 on Monday before the protests in Cairo and several other cities across the country.
"At the opening there was exaggerated buying of the dollar based on yesterday’s protest," said a Cairo-based trader who asked not to be named. "But that’s only in the beginning. I think people now are calmer."
"The Egyptian pound is at the mercy of the news for now and it’s only chance to strengthen is if the euro continues to stay at a high level," said another Cairo trader.