Central Bank of Egypt Free Floats the Pound
We have officially moved to "a liberalised exchange rate regime."
Egypt’s Central Bank (CBE) has just announced that the Egyptian pound has been floated, reports Bloomberg.
The Central Bank “announces its decision to move, with immediate effect, to a liberalised exchange rate regime in order to quell any distortions in the domestic foreign currency market,” the statement read.
The news measure entails that exchange rates be determined by banks based on supply and demand, according to Al Arabiya.
The CBE has also decided to raise lending rates by 300 basis points.
This comes after months of depreciation, with the dollar reaching an all-time high of 18 EGP on the black market last Monday, as the Egyptian government struggles to secure a $12 billion loan from the International Monetary Fund (IMF).