The value of the dollar on the informal exchange market exceeded EGP 9 on Tuesday for the first time since it began being traded on the Egyptian market.
Mohammed Al-Abyad, head of the General Division for exchange companies in the Federation of Egyptian Chambers of Commerce (FEDCOC), said the current rise in the value of the dollar against the pound is not justified at all.
Al-Abyad told Daily News Egypt that the increased demand for US dollars is not justified as there is a state of stagnation in the Egyptian market, which means there is not a commensurate volume of importing operations that would require such high demand for the dollar.
He contended that the devaluation of the pound against the dollar has been fuelled by panic as rumours have spread throughout the market. Al-Abyad argued that some groups stand to acquire huge profits from selling the dollar and thus have an interest in seeing its value artificially inflated.
Al-Abyad speculated that last week’s leak of the state’s budget for the fiscal year 2016/2017, which showed the dollar price registered at EGP 8.25, contributed to the increase in the value of the dollar in the informal market.
Al-Abyad pointed out that the price of the dollar in the informal market ranges between EGP 8.90 and EGP 9.05. There are some reports that it reached about EGP 9.5, but the latter price has not been confirmed yet, he added.
The average value of the dollar in the informal market currently ranges between EGP 9 and EGP 9.03 per dollar.
Al-Abyad emphasised his support for the CBE’s response to the dollar crisis, urging both the government and citizens to support the bank.
According to Al-Abyad there is continuous communication between exchange firms and the CBE, so as to aid the latter in adjusting the exchange market and alleviating the current crisis.
