Senate member Ahmed Samir said that the Central Bank of Egypt (CBE) has not officially announced the flotation of the Egyptian pound so far.
The Central Bank cannot issue a decision to float, even partially, without ensuring a sufficient supply of US dollars in Egypt’s banks, he explained.
The US dollar availability represents an essential element in determining its price in the parallel market, which relies on the vision of the Central Bank.
The Central Bank is solely responsible for monetary policy and tackling the problem of the parallel market in the coming period in accordance with the law, he added, indicating that there is a concrete plan to deal with the parallel market.
“The black market greatly impacts the Egyptian economy and this issue will be addressed as soon as possible,” he assured.
He clarified that the price of the dollar is one of the most significant pillars on which the Egyptian economy depends, as the stability of the price of the dollar will attract more investors to the Egyptian market, alongside controlling the inflation rate of goods and services.
Many measures will be taken in the near future to increase US dollar reserve currency in an effort to maintain the stability of its price in the Egyptian market.
Egypt’s dollar exchange rate on Thursday remained stable, recording LE30.82 for buying and LE30.92 for selling.
The CBE, on behalf of the Egyptian government, paid about $7.154 billion by the end of the second quarter of 2022/2023, representing installments and interests for outstanding debts.
The CBE’s statistical bulletin showed that the debt burden service was divided into paid installments of $5.843 billion, and paid interest of $1.311 billion.
The Standard Chartered Bank said that nearly a third of Egypt’s debt is denominated in foreign currencies, and any additional movement in the US dollar exchange rate against the Egyptian pound will raise the debt-to-GDP ratio.
The bank indicated that progress in the IMF program would be crucial for the Egyptian government, which is seeking to secure financing from the fund – however the first review is still pending.
Floating the exchange rate of the Egyptian pound against foreign currencies is one of the most important conditions of the IMF that was agreed on with the Egyptian government.
Edited translation from Al-Masry Al-Youm