Egypt’s currency will weaken at a steeper pace than expected, although inflation is likely to decrease over the next few years. The Egyptian pound, trading at 19.61 to the dollar on Wednesday, was expected to fall to 21.16 by the end of the current fiscal year, and as far as 22.08 by the end of the next. In July, respondents had predicted a more conservative devaluation, reaching 19.86 by the end of the 2023/24 fiscal year.
A more flexible exchange rate has been indicated as a condition for new financing that Egypt began seeking this year from the International Monetary Fund, as the Russia-Ukraine war threw its already unsettled finances into further disarray.
Foreign investors pulled nearly $20 billion out of Egyptian treasury markets in a matter of weeks, while rising prices of oil and grain brought further pressure. Economists expected lower levels of inflation in coming years – 12.8 per cent by the end of the current fiscal year in June 2023 and 11.6 per cent in the following year.
Source: cyprus-mail.com