An employee counts U.S. dollars in a foreign exchange office in central Cairo, Egypt,
According to the official exchange rate of the Central Bank of Egypt (CBE), the Egyptian pound traded at 19.57 against the dollar, weakening further than the previous record low of EGP 19.56 back on 20 December 2016.
The US dollar exchange rate rose 2 piastres for buying and selling at Egypt's major banks compared to a day earlier.
At the National Bank of Egypt (NBE), the US dollar exchange rate registered EGP 19.48 for buying and EGP 19.54 for selling while it recorded EGP 19.48 for buying and EGP 19.54 for selling at Banque Misr.
The rate reached EGP 19.50 for buying and EGP 19.56 for selling at the Commercial International Bank (CIB), and EGP 19.48 for buying and EGP 19.56 for selling according to the Arab African International Bank’s dashboard.
The CBE official exchange rate was set at EGP 19.46 for buying and EGP 19.57 for selling.
Since the onset of the Russian-Ukrainian war on 24 February, the Egyptian pound has lost over 20 percent of its value against the US dollar after the CBE had applied another depreciation.
On 21 March the pound was devaluated by 14 percent, dropping to 18.28 after having traded at around 15.77 pounds to the dollar since November 2020, according to CBE data.
Since then, the US dollar trading price kept rising with no signs of slowing down.
Minister of Finance Mohamed Maait revealed in August that $22 billion in foreign investment had left the local market since the beginning of 2022.
Egypt has been negotiating a new loan deal with the International Monetary Fund (IMF) and hopes to conclude it before the end of the year to ease its shortage in hard currency.
Interest rate kept still
On Thursday 22 September, the Monetary Policy Committee (MPC) of the CBE decided to maintain key interest rates, against all expectations, for the third time since the initial three percent hike following the onset of the Russian-Ukrainian war.
The MPC kept the overnight deposit rate, overnight lending rate and the rate of the main operation unchanged at 11.25 percent, 12.25 percent, and 11.75 percent, respectively.
The discount rate was also kept unchanged at 11.75 percent.
On the other hand, the MPC raised the required reserve ratio to 18 percent, up from 14 percent.
The CBE has been trying to control the inflation rate that has been soaring since the beginning of the war to register 15.3 percent on an annual basis and 14.6 percent in urban areas.