Total hard currency sold to Egypt's exchange firms hits $20M within 6 days

The total amount of hard currency sold by individuals at government exchange companies in Egypt reached $20 million within six days, bankers informed Asharq Bloomberg.

 

Furthermore, companies, represented by the National Bank of Egypt, Misr, and Cairo banks, have collected proceeds of foreign and Arab currencies equivalent to more than EGP 1 billion since the Central Bank of Egypt's last decisions.

 

Al-Ahly Exchange Company accounts for the largest proportion of the proceeds, with a value of EGP 577 million since the decisions of the Central Bank, according to statements by Abdel Majeed Mohieldin, President of Al-Ahly Exchange Company.

 

 In addition, the concessions of foreign currencies provided to Misr Exchange Company have surpassed LE 420 million since the exchange rate was liberalized, according to a statement made by the company's head, Adel Fawzy.

 

In a special meeting held earlier in March, the Monetary Policy Committee (MPC) of the Central Bank of Egypt decided to raise key interest rates significantly.

 The overnight deposit rate, overnight lending rate, and the rate of the main operation were increased by 600 basis points, reaching 27.25 percent, 28.25 percent, and 27.75 percent, respectively. The discount rate was also raised by 600 basis points to 27.75 percent. 

 

The primary objectives of this decision by the Egyptian government are to combat inflation, achieve price stability, and eliminate the unofficial foreign exchange market.

 

A report by the Central Bank of Egypt (CBE) highlights that the domestic economy is facing challenges due to foreign exchange shortages, leading to the emergence of a parallel exchange rate market and hindering economic growth. 

 

Fluctuations in exchange rates, changes in commodity prices, and supply shocks have contributed to sustained inflationary pressures, causing headline inflation to reach unprecedented levels.