What if Egypt lets the pound slide past 60 to the dollar?
Letting the pound slide past 60 is the by-now-familiar Egyptian devalue-for-IMF trade: eurobonds rally on credibility (tighter EGP spreads) while import-driven CPI spikes — long Egypt USD bonds, short EGP, brace for a CBE hike. The direct rhyme is the March 2024 Ras El-Hekma-funded float and 600bp hike that rallied Egyptian eurobonds hard. The cascade's US-rates pass-through (Fed path, 30y +3bp, mortgages) is spurious; an Egyptian devaluation doesn't move the US curve. Local credit-up / FX-down is the trade.
how we built this number — every step
The class rate is measured from our dated, sourced event library (decade-normalized Poisson — the full table is public at base_rates.json). The variant’s share within its class is the analyst’s editorial call, published so you can audit it. A wider range means thinner precedent. Full recipe: methodology · scored at Reality Check.
The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (gold) over time vs the crowd's (Polymarket, blue), from the past toward the 0–6 months horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. The gold path is an illustrative reconstruction anchored to today's estimate — real dated events, not a live re-estimate history.
What it would mean
If this plays out, it is a mixed shock. Cairo lets the pound slide past 60/USD under renewed IMF pressure, sparking a eurobond rally but import-driven CPI spike. The trigger decomposes into signed root‑shocks — FX carry appetite ▲ · Credit spreads ▼ · Inflation surprise ▲ · EM currencies ▼ — which propagate through our causal graph to the markets below.
If it happens — the markets it would move
Biggest moves first. Projected moves are cascade-model priors; hist A–B% = what comparable past events actually did (measured abnormal returns), and model prior · unmeasured marks markets with no analogue backing yet. Tap any market for its price history.
| Market | Class | Projected move | |
|---|---|---|---|
| 1 | Turkish lira TRY 📈 chart | FX | ▼ -0.6% hist -5.23–+1.73% · other way +0.42% (n=11) |
| 2 | Indian rupee INR 📈 chart | FX | ▼ -0.5% hist -1.1–+0.13% · other way +0.64% (n=11) |
| 3 | Chinese yuan CNY 📈 chart | FX | ▼ -0.3% hist -0.71–+0.04% · other way -0.54% (n=11) |
| 4 | High-yield credit HYG 📈 chart | Rate | ▲ +0.3% hist +0.07–+0.29% · other way -0.25% (n=11) |
| 5 | USD/JPY USDJPYon Hyperliquid 📈 chart | FX | ▲ +0.3% hist -0.19–+0.78% · other way +0.19% (n=12) |
| 6 | Gold XAUon Hyperliquid 📈 chart | Commodity | ▼ -0.4% hist -2.23–+0.64% · other way +2.23% (n=11) |
| 7 | Tech sector XLK 📈 chart | Equity | ▼ -0.3% hist -0.27–+0.02% · other way +0.39% (n=12) |
| 8 | 30y Treasury yield DGS30 📈 chart | Rate | ▲ +3bp hist -4.94–+3.67% · other way +2.5% (n=12) |
| 9 | 10y Treasury yield DGS10 📈 chart | Rate | ▲ +3bp hist -5.27–+4.81% · other way +2.8% (n=12) |
| 10 | Financials XLF 📈 chart | Equity | ▲ +0.2% hist -0.33–+0.94% · other way -1.34% (n=12) |
| 11 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▼ -0.2% hist -8.46–+2.03% · other way +17.42% (n=12) |
| 12 | JPMorgan JPM 📈 chart | Equity | ▲ +0.2% hist -0.4–+0.3% · other way -2.3% (n=12) |
| 13 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▼ -0.2% hist -0.14–-0.01% · other way +0.84% (n=12) |
| 14 | Arm ARMon Hyperliquid 📈 chart | Equity | ▼ -0.2% hist -1.08–+0.69% · other way -7.73% (n=3) |
Probable recommendation
Why we may diverge from history
Trust the measured history SHORT DGS10: twelve clean EM-float analogues hit 73% with 10y yields falling hard (flight-to-quality) — the cascade's LONG over-reaches; an Egyptian-pound break drives Treasury bid, not selloff.
Historical precedent — what analogous events actually did
Across 40 analogous events (overlap‑weighted), as abnormal returns — market beta stripped, so it's the event's own effect, not the market backdrop. Shown at 20 days (persistent) and 5 days (immediate); ↺ fades = the two horizons disagree. Confidence = consistency × sample × significance.
| Asset | History says | Abnormal (20d · 5d) | Hit | n | Confidence | vs cascade |
|---|---|---|---|---|---|---|
| CNY CNY | SHORT | -0.5% · 5d -0.4% | 71% | 25 | 0.35 | ✓ matches cascade |
| MSTR MSTR | SHORT | -7.3% · 5d -4.8% | 67% | 27 | 0.26 | ✓ matches cascade |
| INR INR | SHORT | -0.8% · 5d -0.1% | 61% | 25 | 0.21 | ✓ matches cascade |
| XHB XHB | SHORT | -0.0% · 5d -1.4% | 61% | 25 | 0.19 | ✓ matches cascade |
| Gold XAU | SHORT | -1.9% · 5d -1.6% | 58% | 26 | 0.14 | ✓ matches cascade |
| ARM ARM | SHORT | -1.0% · 5d -3.3% | 60% | 5 | 0.14 | ✓ matches cascade |
| TRY TRY | SHORT | -4.6% · 5d +0.4% ↺ fades | 57% | 25 | 0.13 | ✓ matches cascade |
| 30y yield DGS30 | SHORT | -6bp · 5d -2bp | 58% | 40 | 0.13 | ⚠ differs |
| Bitcoin BTC | SHORT | -0.9% · 5d -3.7% | 54% | 19 | 0.06 | · |
| JPM JPM | SHORT | -0.5% · 5d -0.7% | 53% | 40 | 0.05 | ⚠ differs |
| High-yield credit HYG | LONG | +0.1% · 5d +0.1% | 53% | 25 | 0.04 | ✓ matches cascade |
| USDJPY USDJPY | LONG | +0.6% · 5d +0.4% | 52% | 30 | 0.04 | ✓ matches cascade |
| HOOD HOOD | LONG | +0.8% · 5d -0.8% ↺ fades | 52% | 11 | 0.04 | ⚠ differs |
| XLK XLK | LONG | +0.2% · 5d -0.7% ↺ fades | 47% | 26 | 0.00 | ⚠ differs |
Why this probability
Egypt's managed-float path under IMF makes further slide past 60 quite plausible within six months. A base‑rate‑anchored prior, continuously scored against what actually happens — not a forecast.