Egyptian pound plummets after interest rate hike, exchange rate change
Egypt is contending with high inflation as the central bank continues to look for a way out of the current crisis.
The Egyptian pound fell to a new low against the US dollar today following two significant fiscal changes.
What happened: The Central Bank of Egypt raised several key interest rates today by 2%, citing rising prices internationally.
The bank also announced the start of a "durably flexible exchange rate regime.” This will measure the Egyptian pound against other foreign currencies.
Furthermore, the central bank announced it would start “gradually” stopping the use of letters of credit for import finance. They will completely stop the practice by December of this year, according to a statement.
