Egypt: cash gets scarce as banks stay closed

by | Feb 3, 2011


As the protesters battle it out against the hired thugs in Tahir Square, it’s worth keeping half an eye on the rapid deterioration of the Egyptian economy, too. This from a Nomura report on the situation published yesterday:

Banks will remain closed for the remainder of the work week … Cash is becoming scarce, particularly as many workers have not been able to collect their salaries from the end of January, and concerns are growing about access to food supply in certain areas.

The extended bank closure has begun to raise concerns about deposit runs and extensive demand for foreign exchange, once they do eventually open. And the risk of imposition of capital controls, at least temporarily, has increased. Regular government financing operations have also been interrupted, with the cancellation of a regularly-scheduled treasury-bill yesterday.

Author

  • Alex Evans

    Alex Evans is founder of the Collective Psychology Project, which explores how we can use psychology to reduce political tribalism and polarisation, a senior fellow at New York University, and author of The Myth Gap: What Happens When Evidence and Arguments Aren’t Enough? (Penguin, 2017). He is a former Campaign Director of the 50 million member global citizen’s movement Avaaz, special adviser to two UK Cabinet Ministers, climate expert in the UN Secretary-General’s office, and was Research Director for the Business Commission on Sustainable Development. He was part of Ethiopia’s delegation to the Paris climate summit and has consulted for Oxfam, WWF UK, the UK Cabinet Office and US State Department. Alex lives with his wife and two children in Yorkshire.


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