What: Amid the recent weakening of the U.S. dollar, several Egyptian-based assets have performed well, most notably Egypt’s EGX30 index and gold. Since the beginning of the year, the EGX30 has climbed by an impressive 23% in USD terms, while gold prices have surged by 28%.

When measured in Egyptian pounds, the performance remains strong: the EGX30 has gained 18%, and local gold has risen by 23%, underscoring the resilience and appeal of both assets in the face of global economic shifts.

So What: 

EGX30

A key factor behind the EGX30’s recent outperformance in USD terms is the appreciation of the Egyptian pound. Since April 2025, the USD/EGP exchange rate has declined from 51.6 to 48, significantly boosting the dollar-denominated value of local equity assets. As the pound strengthens, USD-based returns are increased, making Egyptian equities appear more attractive to global investors. According to Bloomberg, the EGX30 index (23% YTD) is ranked 35 out of 92 indices worldwide in USD terms, outperforming the Dow Jones (3.31% YTD) and S&P 500 (7% YTD).

Additionally, hot money inflows have played a vital role. In recent weeks, foreign currency has flowed into Egypt, driving up demand for both the Egyptian pound and local stocks. This surge in foreign investment has not only strengthened the EGP further but has also fueled momentum in the equity market.

The EGX30 in EGP terms started rising when the prices of its constituent stocks increased, driven by strong corporate earnings, positive economic indicators, lower interest rates, and rising local and regional investor confidence. Additional momentum often comes from government reforms and favorable market sentiment, all of which boost demand for equities and push the index higher.

While the EGX30 includes many fundamentally strong companies, Commercial International Bank (CIB) stands out as a heavyweight, accounting for 29.8% of the index. Its dominance is no coincidence. As of early 2025, CIB’s stock has surged 24.3% year-to-date. Renowned for its strong liquidity and consistent profitability, CIB has delivered solid financial results year after year, cementing its role as a key driver of the EGX30’s performance for years.

GOLD

Gold continues to prove itself—both in Egypt and around the world—as the most trusted safe-haven asset. In times of trouble, whether it’s due to currency devaluation, political conflict, or rising inflation, people naturally turn to gold to protect their money. These ongoing global challenges help gold hold its value and remain strong, even when the broader economy is uncertain. Gold is often seen as a safe and steady choice when other investments seem too risky.

This has been especially clear recently, as concerns over U.S. dollar weakness, driven by President Trump’s economic policies, pushed investors toward gold. In April, gold prices hit a record high of $3,500, marking a 30% increase since the start of the year.

Investor confidence and market sentiment also play a major role in driving gold prices. When markets are unstable or the economic outlook is unclear, demand for gold rises. While its price can still fluctuate in the short term, gold has a long history of maintaining its value, making it a popular choice during periods of high inflation or financial stress.

This was demonstrated during the Israel-Iran conflict in mid-June 2025. From June 13 to 24, while the EGX30 experienced noticeable turbulence due to rising regional tensions, local gold prices surged, reinforcing their defensive role in times of crisis.

At the start of the war, gold prices had risen by 6.1%, while the EGX30 index dropped by 4.7%. However, the market began to stabilize toward the end of the conflict.

Outlook: EGX30 vs. Gold

Since early April, the EGX30 has shown steady growth in USD terms, driven largely by a shift in investor sentiment and expectations of a weaker U.S. dollar. As capital moved into Egyptian assets, the index responded with strong gains. However, the future direction of the dollar remains uncertain and will depend on several critical factors.

One major influence is the direction of U.S. economic and trade policies, particularly under former President Trump’s renewed influence. His unpredictable tariff decisions and tensions with Fed Chair Jerome Powell have created uncertainty around U.S. interest rate policy, casting doubt on the dollar’s near-term stability.

If this uncertainty persists, emerging markets like Egypt could continue to benefit. A weakening dollar typically channels investor interest into higher-yielding and more dynamic markets, which could lead to increased foreign inflows and continued appreciation of the EGP and eventually positively impact the EGX30 in USD terms. 

Bloomberg and J.P. Morgan believe that the ongoing weakness of the U.S. dollar will eventually drive investors toward emerging markets and push gold to fresh highs.

Now What: The key question now is whether stocks will outperform gold or vice versa over the coming period. 

For the EGX30 in EGP terms to outperform USD terms, gains must come from strong stock performance rather than currency moves. The outcome depends on economic momentum, investor flows, and how global uncertainty unfolds.