Egyptian pound sinks to record low

Source: financial times

The Egyptian pound sank to a record low against the dollar on Sunday as the government sought to calm fears by announcing it would resume talks with the International Monetary Fund in January to secure a crucial $4.8bn loan.

The pound slid from 6.18 to 6.30 to the dollar on Sunday after the central bank held its first foreign currency auction as part of a new system introduced to slow down the depletion of the country’s reserves.

The measure followed a wave of panic buying of dollars by the public sparked by fears of an imminent devaluation of the Egyptian pound after political turmoil derailed a deal with the IMF.

Youssef Farouk, the manager of al-Masriya, a leading foreign exchange company, said he expected the pound to remain under pressure in the days to come. “I don’t expect it to climb up again. The fears which are causing people to seek dollars have not ended because there is still political tension.”

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