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The Most Important Story From Egypt This Week

From the FT, reporting on the consequences of the fall in the Egyptian currency:

At a central Cairo produce market, vendors have increased prices for green beans by 33 per cent, tomatoes by 50 per cent and zucchini and bananas by 100 per cent. Imported coffee prices have risen more than 20 per cent. The price of bread, a staple of the Egyptian diet, has gone up by 20 per cent in poor neighbourhoods and by even more in well-to-do areas.

Most Egyptians live very close to the margin; a 20 percent rise in the price of bread means that many people will be eating fewer calories and giving less food to their kids. For people in this situation, the only important political question is the availability of the basics you need for survival. The Muslim Brotherhood promised change; so far, the change involves mostly belt-tightening.

Significant further falls in the value of the Egyptian pound can be expected and any economic recovery is a long way off; the question now is whether the MB can hold onto popular (and military) support as conditions worsen, and, if the people begin to turn away from the government, do they turn toward the liberals and the old regime types, or do they double down on ‘Islam as the answer’ and go to the Salafis?

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