The Egyptian pound plunged further to a record low on Wednesday, recording over 31 against the US dollar.
EGP stood at 31.45 per the US dollar as of 3:29 pm GST, compared to EGP 27.68 at the beginning of the trading day. The pound later recovered to 29.55 against the dollar as of 4:04 pm GST.
Egypt's pound lost 51% since March 2022, according to Forbes Middle East's calculations, as part of the new policy required for the International Monetary Fund (IMF) loan deal.
The drop comes one day after the IMF said authorities are on the path toward a flexible exchange rate.
The country can intervene in cases of excessive volatility, the fund said, but any intervention will be “guided” by the need to smooth out market volatility.
The fund warned, however, that the durability of Egypt’s exchange rate policy shift “remains to be proven and the central bank may face political and social pressure to reverse course.”
Egypt has already devalued the currency three times last year.
The North African country is battling its worst foreign-currency crunch in years. The country's foreign reserves fell by $6.9 billion in a year to $34 billion at the end of December 2022, according to data from the Central Bank of Egypt.
Egypt pledged to slow investment in public projects, including national projects to rein in inflation and conserve foreign currency, according to a letter of intent to the IMF in November.
