The Russian war on Ukraine still accounts for an aggressive blow
to the global economy, as it affected the economic growth and led
to a rise in the prices of primary commodities; namely food and
fuel, which led to an increase in the inflation rate.
In order to battle such inflation, the US Federal Bank raised
the interest rate on the U.S. Dollar on multiple instances, and the
European Central Bank followed suit. This increase of interest rate
led to a negative impact on emerging markets' economies.
For Egypt, in particular, the aforementioned decisions were a
catalyst for the exit of $22 billion U.S. Dollars in capital flows,
in addition to the lack of transfers from Egyptians living abroad
due to the high price of the U.S. Dollar in the black market
compared to the official exchange rate in banks. This led to a
decreae of supply of U.S. Dollar in Egypt, and subjected the
Egyptian Pound to severe pressure.
