(NewsWorthy.news) – Amid a rise in demand for precious metals, Egypt has seen an enormous demand for gold with the collapse of its national currency.
For months now, the country has been struggling with major economic troubles, from a collapse in currency (the pound) to a lack of foreign currency availability and steep inflation. Throughout the economic crisis, however, the demand for gold has at least doubled its previous demand, according to the New York Times.
Since September 2023, the value of gold in Egypt has risen by over 30 percent. Although the value and demand are growing, citizens are reportedly not using gold as their primary currency in large numbers. Instead, many have resorted to the United States dollar—which is considered beyond governmental sanctions and part of the black market—to buy and sell.
With the intense increase of demand for gold, the Egyptian government previously said that it was going to collaborate with a financial technology business in order to develop ATMs equipped to dispense bars of gold rather than cash of pounds. But the high demand for precious metals is not only impacting gold.
Silver, for example, has also more than doubled its value for one gram of the metal in a single year, compared to 47 pounds in Egyptian currency. Within the same time frame, a single gram of 21-carat gold increased over 120 percent compared to 3,875 pounds of Egyptian money.
The nation’s demand for precious metals is rising alongside a continuously failing national currency of the pound. On March 6, the Egyptian government established a further devaluation of the currency, amounting to over 38 percent. The move was also accompanied by an increase in the rate of interest.
Additionally, the government’s recent efforts to stabilize the economy included an $8 billion deal with the International Monetary Fund as well as securing a loan of $1.2 billion to fund efforts related to environmental sustainability.
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