The dollar exchange rate rose at the Central Bank of Egypt to a new high At £24.50 on sale, compared to around £24.41 on purchase.
The foreign exchange market in Egypt has seen major changes since the beginning of this year. After the first quotation announced by the Central Bank of Egypt at its extraordinary meeting in March, the Egyptian currency lost about 24% of its value, after the dollar exchange rate jumped from the level of 15.74 pounds to about 19 .64 pounds at the end of last October.
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However, since the second quotation at the end of October until today, the Egyptian currency has lost about 24.7% of its value, after the dollar exchange rate fell from the level of 19.64 pounds, to the current level of about 24. 50 pounds. In regards to the overall losses of the Egyptian pound since last March to date, the Egyptian currency has lost about 55.6% of its value against the dollar, after the US green note rose by about 8.76 pounds.
The highest exchange rate for the dollar in banks was with the Egyptian Gulf Bank and Al Ahli Kuwaiti Bank at £24.45 for the purchase, compared to about £24.48 for the sale. In 8 banks led by the Commercial International Bank – Egypt and Al-Mashreq, the US green note recorded a level of 24.43 pounds for buying, compared to 24.48 pounds for selling.
And in 15 banks led by the National Bank of Egypt and Banque Misr, the dollar’s exchange rate rose to the level of £24.38 in buys, compared to around £24.48 in sales. The lowest dollar exchange rate was that of Al Baraka Bank – Egypt, at £24.36 for the purchase, compared to about £24.46 for the sale.
The Central Bank of Egypt has started implementing the flexible or managed float policy since the end of last October, as part of an attempt to control the foreign exchange market. However, until now, speculation on the dollar has been going on in the parallel market, although its pace has slowed down in recent days.
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In parallel with the devaluation of the Egyptian pound, the Central Bank of Egypt announced the cancellation of relations with import documentary credits, especially after the accumulation of goods in Egyptian ports, which caused shortages of some goods. The documentary credits will expire at the end of next December, according to the indications of the Central Bank of Egypt.
A few days ago the credit rating agency “Fitch” announced the change of the outlook on the Egyptian economy from “stable” to “negative”, attributing it to the “worsening” of the country’s external liquidity situation. The agency maintained the country’s credit rating at (B+) level, attributing it to strong economic growth and “strong international support” from Gulf allies and international partners.
And he warned that he could downgrade the rating in the coming months if pressures on external financing persist or if the government is unable to reduce the deficit and reduce the debt-to-GDP ratio.
While the reduction reflects “the deteriorating external liquidity situation and declining prospects for accessing the bond market, which makes the country vulnerable to adverse global conditions at a time of high current account deficits and external debt maturities”, he suggested Fitch, adjusting its prospects for the Egyptian economy, to the deteriorating situation Egypt’s foreign currency liquidity and poor prospects for access to the bond market, which grapple with the consequences of global events at a time when its current account is running a period of high deficit and is waiting for it to repay its external debts.
