Foreign investors have sold off a massive amount of Egyptian government debt (bonds and treasury bills).
In just four days of trading, they pulled out more than LE 102.3 billion, which is roughly $2.046 billion. While the stock market also saw foreigners leaving, local Egyptian and Arab investors stepped in to buy those shares, keeping the market active.
Why is this happening?
Financial expert Hany Aboul Fotouh explains that this is a classic “flight to safety.” When wars or major political tensions break out in a region—like the current conflict with Iran—investors get nervous. They pull their cash out of “emerging markets” (like Egypt) and put it into safer assets that hold their value, such as gold, silver, and palladium.
How is this different from past crises?
During the Russia-Ukraine war, about $20 billion left Egypt. Back then, the exchange rate was fixed. This time, things are different:
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Flexible exchange rate: The Central Bank is letting the value of the Pound move naturally.
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The “exit brake”: As the Dollar gets more expensive, it actually discourages some investors from leaving because they would lose a portion of their profits when converting their money. Many are now choosing to wait for the markets to settle.
Impact on reserves
All eyes are now on the Central Bank’s upcoming report for March 2026. Experts predict that Egypt’s foreign currency reserves might drop by $5 billion to $7 billion compared to February, as the bank covers these large withdrawals.
