By: Islam Fadl

Cairo – Mubasher: A group of banks operating in Egypt began to increase the USD-EGP exchange rates on Tuesday following the Central Bank of Egypt's (CBE) announcement regarding the decline in international reserves during December.

Last month, Egypt’s international reserves declined 4.4% month-on-month, or $1.9 billion, to $42.55 billion, compared to $44.51 billion a month earlier.

Year-on-year however, reserves increased by 14.9%, or $5.53 billion, the central bank’s data showed.

The National Bank of Egypt (NBE) upped the USD purchase and sale prices to EGP 17.79 and EGP 17.89, respectively, while Credit Agricole hiked its USD-EGP exchange rate to EPG 17.88 for buying and EGP 17.98 for selling, and Suez Canal Bank (SCB) increased the US dollar price to EGP 17.9 for purchase and EGP 17.96 for sale.

The decline in Egypt’s international reserves will not have an impact on foreign exchange rates, SCB chairman Hussein El-Refaie told Mubasher.

He further explained that the increase in the USD's exchange rate against the EGP was normal and that the slight rise was not an anomaly.

El-Refaie further noted that the CBE had enough reserves to cover the country’s imports and obligations for the next nine months.

Similarly, former vice chair of Banque Misr Sahar Al-Damaty agreed that the rise in the USD/EGP exchange rate was not because of the fall in international reserves, but described such movement as “normal” and “daily.”

As for the reasons for the decline in international reserves, Al-Damaty cited repaid dues to foreign oil companies and the disbursement of treasury-bill dues to foreign investors.

Translated by: Muhammad Khalid