The decline in the value of Egyptian pound against the US dollar continued for the third consecutive day, officially plummeting to EGP 7.34 on Wednesday.
The dollar selling price at the National Bank of Egypt and Banque Misr climbed to EGP 7.38
The value of the US dollar had remained at around EGP 7.14 during the past six months. In December, however, the Central Bank of Egypt announced that it will raise the number of weekly dollar bids, which led many analysts to forecast devaluation for the Egyptian pound.
The devaluation of the Egyptian pound started on Sunday, with the CBE announcing that the value of US dollar was EGP 7.19. On Monday, further decline in Egyptian pound was experienced, with the dollar’s value standing at EGP 7.32.
This devaluation is believed by economists to reassure foreign investors who would like to invest in dollars. Others argued that prices of consumer goods such as medicine, oil and some food products will get higher.
Following the first drop of the Egyptian pound, Pharos Holding for Financial Investments anticipated a further 5% devaluation. The company explained that Egypt is under pressure to combat the parallel market prior to the March Economic Summit to encourage investments.
HSBC is expecting the value of dollar to rise to EGP 7.50 in 2015 and ascend to EGP 8 in 2016.