Egyptian Pound sees biggest single-day drop since IMF deal

CAIRO — Authorities said the Egyptian pound fell on Wednesday in its biggest day of slide since the cash-strapped government agreed to a $3 billion deal by the International Monetary Fund in mid-May twelfth.

The pound fell from about 24.7 to 1 USD to just over 26.3 against the dollar, about three weeks after Egypt and the IMF officially approved the support package, approved in exchange for some reforms. economy by the country’s Central Bank, including the move to a flexible exchange rate.

The package allows for an additional $14 billion in financing to Egypt.

Egypt’s economy has been hit hard by years of government austerity, the coronavirus pandemic and the aftermath of the war in Ukraine. Egypt is the world’s largest wheat importer, with the majority of its imports traditionally coming from Eastern Europe.

Since the beginning of 2022, the Egyptian pound has lost more than 60% of its value against the dollar, with the country currently facing a shortage of foreign currency.

In recent months, Egypt has also faced rising inflation, with an annual rate above 18% in November. The central bank has sought to curb the rise by raising interest rates. capacity.

National Bank of Egypt and Banque Misr – two of Egypt’s state-owned banks – announced they were offering savings certificates with an interest rate of 25%, a move experts believe. is another attempt to curb inflation.

Most Egyptians rely on government subsidies to buy basic goods like bread, a policy that has been in place for decades. Nearly a third of Egypt’s 104 million people live in poverty, according to government data.


This story has been corrected to show that the Egyptian pound has lost more than 60% of its value against the dollar since the beginning of 2022, not this year.


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