After fixing the Egyptian pound’s price against the US dollar on Tuesday, speculations circulated in the market that the decision was made after President Abdel Fattah Al-Sisi rejected the Egyptian pound’s devaluation in a meeting earlier in the week.
The governor of the Central Bank of Egypt (CBE), Tarek Amer, met with Al-Sisi on 9 July, three days before the decision to fix the price of the pound.
In the meeting with President Al-Sisi, Prime Minister Sherif Ismail, and Minister of Finance Amr El-Garhy, Amer presented the country’s plan to increase the sources of foreign exchange in the short term and the CBE’s plans to support the state’s directions towards quickly reforming the financial structure.
Sources told Daily News Egypt that it is likely that Amer presented the devaluation of the Egyptian pound against the US dollar to Al-Sisi, as well as the pros and cons of that decision. They assume that Al-Sisi was against taking the decision at the time, in order to prevent a hike in prices.
One factor that supports this assumption is that the presidency’s statement after the decision stressed on the necessity of considering the societal segments that deserve and need the most financial support, the sources added. The statement assured that such reforming measures should not affect these segments and that basic goods should be available at stable prices.
Sources close to Amer stated that several occurrences put pressure on the CBE governor, including the rise of the US dollar to an unprecedented EGP 11.4 in the unofficial market, as well as reports by research institutions, investment banks, and analysts about a new Egyptian pound devaluation.
The sources noted that Amer, who is known for his composure, seemed irritated that the CBE is becoming a scapegoat. The lack of foreign exchange resources and the increase of the US dollar exchange rate is not solely the CBE’s responsibility, they added.