Citigroup anticipates that the Central Bank of Egypt may resort to delaying the devaluation of the Egyptian pound against the US dollar until at least the end of June, which has prompted traders to lower their expectations regarding the devaluation. Credit rating institutions are calling on the Egyptian government for a more flexible exchange rate which reflects the country’s external financing needs, according to supply and demand. A flexible exchange rate is also a major demand of the International Monetary Fund, since it signed a financing agreement with Egypt worth three billion dollars at the end of 2022. According to Costa, the Central Bank of Egypt will also probably wait for “bumper tourism” revenues of about $14 billion to filter through the economy before deciding on the need for another pound recalibration. “The CBE will likely not engineer another aggressive pound devaluation over the next month or so,” Costa wrote in a note.

Source: Egypt Independent June 04, 2023 15:51 UTC