Adel said – in statements to the Middle East News Agency – that the Central Bank’s announcement of monitoring violations and illegal practices taking place in the foreign exchange market; indicates strong prospects for cracking down on speculators and manipulators in the exchange market; This leads to the return of discipline and the disappearance of the parallel market.
He added that a solution to the crisis of releasing goods at ports is imminent, especially after the Central Bank announced that it has procured more than five billion dollars since the beginning of this December to cover requests for documentary credits. This did not affect the official exchange rate during the past weeks, and the pace of speculation on the dollar on the black market subsided, and its prices fell to near official price levels.
The expert pointed out that the exchange market witnessed – in the past period – speculative operations due to rumors of a new devaluation of the pound. Coinciding with the agreement with the International Monetary Fund on a new financing package worth three billion dollars, however, the Central Bank’s “good” management of the money market file contributed to overcoming the impact of these rumors, which had the greatest impact on the shock and confusion that afflicted the black market and led to its incurring great losses. .
He explained that the Monetary Policy Committee’s decision to raise interest rates by 3% without prejudice to the value of the pound and the exchange rate completely; Contributed to creating a recovery in the country’s dollar flows, enabling it to meet a large part of the foreign exchange needs, as well as maintaining an acceptable official exchange rate.
Regarding decisions to set maximum limits for withdrawals from abroad, the banking expert said that the Central Bank issued directives to banks to tighten control over bank cards for foreign currency outside Egypt, and set maximum limits for transactions with them, in addition to the Central Bank disclosing a list of illegal practices affecting the foreign exchange market; It will reduce speculation and drain the country’s foreign exchange resources.
He added that the statements of the political leadership regarding the efforts of the state and the banking sector’s plan to procure the necessary foreign exchange, to cover the documentary credits related to the goods accumulated in the ports, which resulted in saving five billion dollars during the current month; It created great satisfaction in the market with regard to the plan of the government and the Central Bank in dealing with the file of the exchange market and the provision of foreign exchange.
Regarding the issuance of savings vessels with high returns, Adel explained that the leaders of major government banks have ruled out this trend, especially since the current situation does not require the issuance of savings vessels with a high return to ensure that there is no pressure on liquidity rates and the maintenance of targeted growth rates, especially since high inflation rates are primarily a result. Global factors, in addition to some practices of traders and in the exchange market, led to the rise in prices.
Adel expected that the coming period will witness more foreign exchange flows to Egypt, which will enhance the country’s ability to meet market needs, and the final solution to the port goods crisis, praising the banking sector’s handling of the monetary policy file and confronting inflation.
He explained that once the provision of foreign exchange is completed for the entry of goods into the ports; It is likely that the price of the dollar in the official market in banks will witness a wave of gradual declines. This will also affect the parallel market and the stability and decline of product prices with the increase in the supply of goods in the markets.