By Yolande Knell
BBC News, Cairo
Police walk past the al-Hussein mosque on the morning after the bomb blast
The speculation in Cairo is that Islamist militants angry at Egypt's stance over the recent Gaza conflict may have been behind a bomb attack which killed a French tourist close to the al-Hussein mosque in Khan al-Khalili in Cairo.
While no group has yet claimed responsibility, it is a reminder that the stakes are high for Egypt as it acts as a mediator to secure a long-term truce between Israel and the Palestinian Islamist group, Hamas.
"I believe the timing of the bombing relates to what is going on in the region particularly regarding Egypt's position on certain issues, like what happened in Gaza between Hamas and Israel," says terrorism researcher, Abd al-Rahim Ali.
"A number of opposition forces are against moderates in the region and Egypt in particular," he adds.
During three weeks of fighting in Gaza it was clear that the crisis crept over Egypt's doorstep.
At the border you could feel tremors from Israeli bombs dropped on Palestinian land and locals explained how they profited from smuggling through secret tunnels.
While hundreds of injured Palestinians were helped in leaving Gaza through the Rafah crossing and humanitarian aid was allowed in, many Egyptians criticised their government for having shut the gates after Hamas took over by force in mid-2007.
In defiance of a ban on demonstrations, large crowds took to the streets in Egypt, led by members of the main Egyptian opposition movement, the Muslim Brotherhood - which is ideologically linked to Hamas.
Following a Cairo rally - brutally broken up by police - activist Sondos Asem told me: "By refusing to open the Rafah border crossing permanently the regime has allowed the massacre in Gaza to happen. It listens to its Israeli allies and not to its people."
To some extent Egypt's ceasefire proposals, first set out by President Hosni Mubarak on 6 January, were an attempt to answer such critics.
It was hoped the country could be an effective go-between for Hamas and Israel - which do not talk directly - as it has been in the past.
"Egypt is well-placed to mediate," says Emad Gad from the pro-government al-Ahram Centre for Political and Strategic Studies.
"It is a neighbour country for Israel and Gaza, it has a peace treaty with Israel and always tries to play an active role to achieve an independent Palestinian national state. This is important to most Egyptians.
"It helps that Israel sees the Mubarak regime as moderate and knows it does not want a religious government in Gaza. It also has good relations with the Palestinian President Mahmoud Abbas and the United States."
Egypt has faced competition for the role of regional powerbroker from Iran and Syria - with their close ties to Hamas - and Qatar which hosted its own Arab summit during the Gaza conflict.
So far it has managed to see off their advances but now it is losing credibility because of its failure to deliver a proposed 18-month truce despite weeks of meetings.
The Egyptians have responded to Israel's demand for a crackdown on smuggling to prevent arms reaching Hamas by installing surveillance cameras and motion sensors along the Gaza border.
However the Egyptians are unable to satisfy Hamas which wants the blockade of Gaza lifted.
Many Egyptians criticised their government's handling of the recent Gaza conflict
Israel insists the opening of border crossings must be connected with the release its soldier, Gilad Shalit, held in the territory since 2006. The Egyptian intelligence chief, Omar Suleiman, had been overseeing two separate sets of negotiations between Israel and Hamas: one on Shalit - involving a prisoner exchange - and one on a ceasefire.
Hamas says the issues should be kept separate.
Already unilateral ceasefires declared by Israel and Hamas have been shaken by Palestinian rocket fire and Israeli military raids.
If talks break down, there is a danger they will completely unravel.
Egypt desperately wants to stop that happening to avoid another war next-door with all its consequences including possible further attacks by extremists at home.
With Palestinian national dialogue due to take place in Cairo this week, it knows an agreement to stop the fighting in Gaza would help mend differences between Hamas and Mr Abbas's Fatah faction.
A ceasefire would also benefit a Gaza reconstruction conference - which the US Secretary of State, Hillary Clinton is expected to attend - in Egypt on 2 March.
Without a guarantee that the conflict is over, some donors may see little point in pledging money.