The US dollar saw a slight depreciation in the local market last week, with its buying rate easing to LE49.85 and its selling rate to LE49.95. This is a decrease from the previous week’s rates of LE50.61 for buying and LE50.71 for selling, according to data released by the Central Bank of Egypt (CBE).
Globally, the greenback drifted on Friday, hovering near its lowest level in more than three years against the euro and sterling, as traders wagered on deeper US rate cuts while awaiting trade deals ahead of a July deadline for President Donald Trump’s tariffs.
With the geopolitical tremors of Israel-Iran conflict in the rear view after a ceasefire that appeared to be holding, market focus this week has been on U.S. monetary policy.
The prospect of Trump announcing the next Federal Reserve chair, who is expected to be more dovish, earlier than usual to undermine the current chair Jerome Powell has raised odds of the central bank cutting rates.
Powell, whose term ends in May, was also interpreted as being more dovish this week in testimony to U.S. Congress, adding to expectation of more rate cuts. Traders are now pricing in 64 basis points of easing this year versus 46 bps expected on Friday.
“The sooner a replacement is announced for Powell, the sooner he could be perceived to be a ‘lame duck’,” said Carol Kong, a currency strategist at Commonwealth Bank of Australia (OTC:CMWAY).
The Wall Street Journal reported on Wednesday that Trump has toyed with the idea of selecting and announcing Powell’s replacement by September or October, a move analysts say could lead to the person operating as a shadow Fed chair, undermining Powell’s influence.
Trump has not decided on a replacement for Powell and a decision is not imminent, a person familiar with the White House’s deliberations told Reuters on Thursday.
