Egypt: Exchange companies collect nearly $189.1mln in foreign currencies in 26 days

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Exchange companies associated with the National Bank of Egypt, Banque Misr, and Banque du Caire have amassed Arab and foreign currency proceeds totalling EGP 8.940bn. This collection occurred from the time the Central Bank of Egypt (CBE) liberalized the exchange rate on March 6th last year until the close of transactions this past Monday.

Abdel Majeed Mohy El-Din, President of Al Ahli Exchange, reported that the company has drawn proceeds of EGP 5bn since the CBE’s decision, with EGP 297m collected just yesterday.

Adel Fawzy, President of Misr Exchange, noted that the company’s foreign currency transfers during this period reached EGP 3.510bn, with the dollar comprising 60% of these transfers.

Mohamed Ragai, CEO of Cairo Exchange, highlighted that the company’s currency transfer proceeds have surpassed EGP 430m in the same timeframe.

In a significant move, the CBE decided to let the exchange rate float according to market dynamics in an extraordinary meeting on March 6th of this year. This decision is pivotal as it aims to unify the exchange rate, thereby preventing the buildup of foreign currency demand due to the disparity between official and parallel market rates.

CBE Governor Hassan Abdullah emphasized in a press briefing that the Central Bank has no intention of pegging the dollar to a specific rate, opting instead to let market forces dictate. He added that the CBE would only intervene in the event of unusual market volatility.

Following this policy change, banks and exchange companies in Egypt have seen substantial dollar inflows and increased trading of major foreign currencies.