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Investing.com – The exchange rate movements in the market witnessed, today, Wednesday, a new decline in the Egyptian pound against its decline at the highest pace in 2022.
During these moments of today, Wednesday, the Egyptian pound lost 5 piasters in one go, to record the largest daily decline in one session since the last price liberation in March.
The Egyptian pound fell after the latest devaluation, near the lowest price recorded in the official market, according to the data of the Central Bank of Egypt, at levels of 19.56, which was recorded on December 20, 2016.
pound now
According to the screen of the National Bank of Egypt and Banque Misr today, Wednesday, the dollar exchange rate recorded an increase against the Egyptian pound by 5 piasters, up from 19.45 pounds for sale and levels of 19.39 pounds for buying, to levels of 19.5 pounds for sale and 19.44 pounds for purchase.
In the private banks, Abu Dhabi Islamic Bank, Commercial International Bank, Egyptian Arab Land Bank, The United Bank, Alexandria Bank, HSBC, and the Arab African International Bank, the selling price of the dollar recorded levels of 19.52 pounds, while the purchase price recorded levels close to 19.49 pounds to the dollar.
According to the data of the Central Bank of Egypt today, Wednesday, after updating the price screen, the pound fell to levels of 19.5384 pounds for sale, while the purchase price amounted to 19.4300 pounds to the dollar.
Yesterday, Tuesday, the Central Bank of Egypt’s data revealed that 100 billion pounds of liquidity was withdrawn for the sixth time in about a month, through open deposits with fixed income bids.
lowest ever
The pound’s losses have increased against the dollar since the new Egyptian Central Bank governor, Hassan Abdullah, assumed the presidency of the bank on August 18, 2022, succeeding the resigned governor, Tariq Amer, causing the pound to lose 34 piasters in total.
While the pound has fallen since the decision to liberalize the exchange rates, or as described by the former central governor at the time, the correction of exchange rates, increasing by 3.55 pounds, or the equivalent of a 23% decline.
According to the official data of the Central Bank of Egypt for the exchange rate of the dollar against the pound, the lowest price was recorded on December 20, 2016, where the dollar exchange rate was 19.5605, the highest official ever.
Important decisions
The Central Bank of Egypt announced the withdrawal of 100 billion pounds of excess liquidity at local banks for the sixth time in a row, as part of the linked deposit mechanism that it issues weekly to control the money supply in the market.
The Central Bank issued new instructions to facilitate import operations, as well as other instructions it had previously issued, after a meeting of the Deputy Governor of the Central Bank with manufacturers.
Jihad Azour, director of the Middle East and Central Asia Department at the International Monetary Fund, said that the IMF’s negotiations with Egypt to obtain financing are in continuous progress, and soon they will be completed.
interest decision
The Central Bank of Egypt will hold a meeting of the Monetary Policy Committee to settle interest rates on deposit and lending tomorrow, Thursday, September 22, according to the schedule of the Monetary Policy Committee’s meeting for 2022.
The Egyptian Central Bank had violated the expectations of experts and analysts at the last August meeting, which indicated that the Central Bank of Egypt would raise key interest rates by 1%.
The Central Bank decided to fix the interest rate twice in a row in June and August, after raising it by a total of 3% for the first time from 5 years, including 1% on March 21 in an exceptional meeting of the Monetary Policy Committee, and 2% last May.
Expectations
The Research Department of Zilla Capital expected the Central Bank of Egypt’s direction to fix the interest rate at the next Monetary Policy Committee meeting, scheduled to be held tomorrow.
Economist Hani Genena expected a rate hike at the monetary policy meeting next Thursday, noting that the rate hike is likely to reach 2%.
Radwa Al-Swaify said; Head of research for Al-Ahly Pharos, said that given the current unusual circumstances the country is going through and the pressure on the budget deficit, it is expected that the Central Bank of Egypt will decide to deviate from the usual path, and not go to the option of raising the interest rate.
On the other hand, Muhammad Abu Pasha expected; Chief Economic Analyst, Vice President of Research at EFG Hermes, raised the interest rate, during the upcoming Monetary Policy Committee meeting, by 100 basis points.
Amr Al-Alfi predicted; Head of Research at Prime Securities, he raised interest rates by 1% as a result of accelerating inflation, noting the central bank’s focus on expectations, in addition to the rise in the dollar price is one of the inflationary pressures.
The Federal Reserve – the US Central Bank – meets today to discuss the fate of interest, in light of expectations of raising it 0.75% to 1%, which comes one day before the Central Bank of Egypt meets for the same purpose.
Investment Certificates
Yesterday, Tuesday, local media quoted well-informed sources as saying that the Central Bank of Egypt is about to take a decision to raise interest rates on deposits and lending for the third time during 2022.
According to the news, the Central Bank of Egypt’s decision is expected to come in an attempt to control inflation rates during the Monetary Policy Committee’s meeting at the end of the week.
The source said that the Central Bank will raise the interest rate on deposit and borrowing by 150 basis points in the next meeting, to reach 12.75% and 13.75%.
The source indicated that, in conjunction with the increase in interest rates, the Central Bank is re-issuing investment certificates of 18% again through the National Bank of Egypt and Egypt; To compensate holders of deposits in the Egyptian pound for the decline in its value against the dollar.
The source added that these measures, which the Central Bank is expected to take at the meeting next Thursday, will have a strong resonance on the Egyptian economy, and will raise the value of customers’ concessions on their foreign exchange holdings, and reduce dollarization operations.