Parallel Market Trading Dollar "Completely Paralyzed", Commerce Chamber Says

A state of complete paralysis of the parallel market for foreign currencies occured, with heavy offers for sale without the slightest purchase order, which led to a decline in the black market price to start approaching the official price, which rose to EGP 27.16 in the Central Bank of Egypt (CBE).

Alaa Ezz, Secretary General of the Federation of Chambers of Commerce explained that this came after the collapse of demand from the private sector due to the successive releases made by the government and banks during the last period, which exceeded $6.8 billion, and coincided with the increase in net cash reserves by $470 million during December.

The demand on the dollar also dropped after the National Bank of Egypt (NBE) and Banque Misr offered certificates with an unprecedented annual return of 25%, which attracted those seeking a safe haven of value instead of speculating in dollars, which lost about EGP 10 in a week.

He pointed out, in a statement, that with the opening of a large number of Banque Misr and National Bank branches during the holidays to issue the 25% certificates, it is expected that those who speculated and lost would flock to the speed of converting the dollar into pounds to buy the certificates during the holidays at Thursday’s closing price of EGP 16.27 to the dollar to expect the price to drop to its previous level after the bank holidays next Monday and to incur additional losses.