Egyptian Banks Record Cash Inflows of $9 Billion since the Flotation of the Pound
Egypt's Central Bank and IMF are optimistic about the growing trust in Egypt's currency market amid news of increasing foreign holdings.
Since the flotation of the Egyptian pound three months ago, Egyptian banks have attracted $9 billion in cash inflows, mostly "from households and private businesses selling foreign currency and remittances from abroad," according to Bloomberg. The figure indicates renewed trust in the Egyptian currency, the network says.
Citing Central Bank data, foreigners held 10.2 billion pounds in T-bills in December, a massive increase from October's figure of 989 million pounds, which was shortly before the flotation in early November.
“We have seen a notable improvement in foreign currency inflows to banks over the past few weeks,” Rami Aboul Naga, assistant sub governor of the Central Bank, told Bloomberg News on Tuesday. “Trust in the system is growing.”
Egypt's flotation of the pound has enabled the government to secure a $12 Billion loan from the IMF, which has encouraged the government's reform program and described Egypt's currency market after the flotation as well functioning, adding that the Egyptian pound may strengthen after a period of overshooting, Bloomberg News reports.