Amr El Alfy, head of research at Prime Holding Company, said it was better for the Egyptian economy to see a flexible and gradual decline in the pound against other currencies, especially the US dollar.
Al-Alfi added, in an interview with Al-Arabiya, that: Currency devaluation helps the Egyptian economy To absorb any global crises that may occur.
He stressed that Egypt’s general budget was affected by the consequences of the Russo-Ukrainian war which broke out in February 2022, and therefore by the conditions of the local economy, which led the Central Bank to devalue the pound on March 21. .
Al-Alfi said the Egyptian pound’s devaluation rate was about 15% in March, and was not accompanied by a loan from the International Monetary Fund, followed by another devaluation in October of 20%, accompanied by an agreement on a loan of 3 billion dollars from the International Monetary Fund.
He pointed out that since the first listing in 2016, the Egyptian currency has recorded a 55% decline against the dollar and was accompanied by a loan from the International Monetary Fund of about 12 billion dollars.
Al-Alfi said estimates regarding the devaluation of the pound last October indicate that the devaluation was not enough and that the pound is expected to decline further, which has led to the emergence of currency speculation in the recent period.
And he believes that there is again speculation about a further devaluation of the Egyptian pound, pointing out that the devaluation of the pound in the current period will not work because Egypt needs to have export power to benefit from this depreciation of its currency.
And he stated that: “Deducting the pound again will do more harm than good at the moment, while the dollar price boom is the result of a lack of liquidity in the banking system.”
He expected that the dollar would be available on the market after the approval of the loan from the International Monetary Fund on December 16, and therefore the price of the dollar would slow down.
Al-Alfy estimated that the Egyptian central bank will raise the interest rate by 1-2% until the first half of 2023, indicating that the interest increase affects the Egyptian government’s financing expenditures.
As for stock prices, Al-Alfi said they rose sharply last October amid attempts by people to preserve the value of their money.
