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Egyptian pound declines against dollar in parallel market

Egyptian pound declines against dollar in parallel market
The US dollar registered between EGP 16.10 and 16.50 - (Photo Credit: Arabianeye-Reuters)

By: Mahmoud Salah El-Din

Cairo - Mubasher: The Egyptian pound continued its decline against the US dollar in the parallel market on Wednesday, amid growing signs of a currency devaluation, with the government talking about painful necessary economic reforms.

According to three traders, the dollar price ranged between EGP 16.10 and 16.50 on Wednesday.

Egyptian president, Abdelfattah El-Sisi said on Tuesday that Egyptian must stand the upcoming economic reforms, in what was considered a clear sign regarding floating the pound.

The prime minister, Sherif Ismail said in a TV interview on Tuesday that the exchange rates must reflect the currency’s actual value, he also stressed that having two exchange rates in the market cannot continue.

The decision is connected to several issues, such as the government’s securing of the strategic reserves for the next six months, and securing the $6 billion required funds by the International Monetary Fund (IMF) to approve the loan agreement, Eman Negm, analyst at Prime Research told Mubasher.

Negm added that parallel market is witnessing speculations prior to the currency devaluation decision, which timing may be affected by other factors, such as the call for protests on 11 November.

The official exchange rate for the US dollar in the Egyptian banks is EGP 8.88.

Translated by: Moslem Ali