Gaza on verge of famine as war escalates, ceasefire talks stall    Gaza crisis, trade on agenda as Trump hosts Starmer in Scotland    Obama calls for aid access to Gaza, says 'no justification' for withholding food    Egyptian president follows up on initiatives to counter extremist thought    Egypt's SCZONE eyes deeper investment, port digitalisation ties with Singapore    Egypt's gold prices slip slightly on July 28th    Egypt's Housing Min. reviews HDP marketing plan    Indian Embassy to launch cultural festival in Assiut, film fest in Cairo    Egypt, South Africa pledge to deepen development cooperation at G20 meeting    Egypt's PM orders road maintenance review, tougher penalties to curb accidents    Egypt, Novartis explore expanding collaboration in oncology, cardiology    Egyptian aid convoy heads toward Gaza as humanitarian crisis deepens    Midar partners with Adeer to develop Boulevard project in Mostakbal City with EGP 70bn investment    Association of Real Estate Developers seeks urgent meeting over threatened land deallocation on Northwest Coast    Culture minister launches national plan to revive film industry, modernise cinematic assets    Sudan's ambassador to Egypt holds reconstruction talks on with Arab League    I won't trade my identity to please market: Douzi    Egypt welcomes 25-nation statement urging end to Gaza war    Sisi sends letter to Nigerian president affirming strategic ties    Egypt, Senegal sign pharma MoU to unify regulatory standards    Two militants killed in foiled plot to revive 'Hasm' operations: Interior ministry    Egypt, Somalia discuss closer environmental cooperation    Egypt foils terrorist plot, kills two militants linked to Hasm group    Egypt's EHA, Huawei discuss enhanced digital health    Foreign, housing ministers discuss Egypt's role in African development push    Egypt reveals heritage e-training portal    Three ancient rock-cut tombs discovered in Aswan    Sisi launches new support initiative for families of war, terrorism victims    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Egypt's Irrigation Minister urges scientific cooperation to tackle water scarcity    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



CBE stabilises US dollar exchange rate causing confusion in market
The higher inflation rate caused the CBE to postpone another devaluation of the pound until the end of this year, says analyst
Published in Daily News Egypt on 12 - 07 - 2016

The Central Bank of Egypt (CBE) stabilised the exchange rate of the US dollar against the Egyptian pound on Tuesday, in a move that contradicts the expectations of many analysts.
This decision has raised serious confusion in the market, especially among holders of US dollar and those who bought dollars at high prices in the past few days hoping that the CBE would further devalue the pound.
Many analysts expected that the CBE would reduce the value of the pound following CBE Governor Tarek Amer's recent remarks in which he said that the CBE had been mistaken to defend the pound over the past few years.
The dollar jumped Tuesday to EGP 11.40 on the informal market, driven by the increased speculation.
Osama El-Menilawy, assistant general manager of the financial sector at a private bank operating in Egypt, said analysts and exchange market officials predicted an 80% likelihood that the Egyptian pound would be devalued, until the inflation indicators were announced on Sunday 10 July.
The indicators showed that there was a remarkable increase in inflation rates and expectations for a further increase in the coming period. Therefore, the likelihood of a reduction in the value of the Egyptian pound was lowered to 50% by analysts.
El-Menilawy noted that analysts disagreed about whether the CBE would devaluate the pound on Tuesday or would delay it; however, most of their expectations—following the release of the inflation indicators—tended towards non-reduction, which is what actually occurred.
A further devaluation of the pound is coming, he said, but inflation and the government direction to increase prices are worsening Egyptians' standard of living, so the decision will be delayed until the end of 2016.
A government source noted on Monday that the government may cancel its subsidy of petroleum and electricity products, activate the value-added tax, and increase the tax on cigarettes in order to reduce the budget deficit and reduce the aggravation of public debt.
The CBE devaluated the Egyptian pound in mid-March by roughly 112 piastres against the US dollar, which brought the US dollar's price to EGP 8.85. It was then increased by 7 piastres the following day to settle the price of the dollar officially at EGP 8.78.


Clic here to read the story from its source.