After seeing the Egyptian currency tumble to record lows of $1=E£18.50 earlier in the week, the Central Bank of Egypt (CBE) announced on 3 November that it would devalue the pound by 32% and allow it to float freely in a bid to stem its freefall and eliminate the flourishing black market.

The CBE said in a statement that its decision to liberalize the exchange rate was intended to return to buying and selling of foreign currency by the banking sector in a way which reflects supply and demand in the market and “create an environment of reliable and sustainable provision of foreign currency.” It also raised by 3% the overnight benchmark interest rate to 14.75% for deposits and 15.75% for loans to further support the pound. (CONTINUED - 1089 WORDS)