CAIRO: Gamal Nagm, the Central Bank of Egypt (CBE) deputy governor, announced Wednesday that the CBE is working on ending the “parallel” black market for dollars at currency exchanges, and said the markets will end completely within three months.
Nagm said foreign currency prices in the black markets have declined in past days due to the CBE’s applied strategies, Mubasher reported.
Black market dollar prices ranged between 7.22 EGP and 7.30 EGP to the dollar while the price at the official market was 7.18 EGP according to the latest CBE update Thursday.
In April and May, the black market exchange rate hit between 7.60 EGP and 7.75 EGP to the dollar while the official exchange rate was between 6.90 EGP and 7.00 EGP, Al Arabia reported.
To address the problem, the CBE in December 2012 created new mechanisms to control prices and balance the dollar exchange rate. This included dollar auctions and exceptional tenders to provide needed hard currency for basic goods importers, banks and exchange companies, the CBE reported.
Since the beginning of 2014, the CBE has offered about 209 periodical dollarized offers totaling about $8.5 billion, in addition to five exceptional dollarized bids totaling $5.3 billion, according to the CBE home page
In a phone interview, Ahmed Qura, the former head of Al Watany Bank, told The Cairo Post that besides auctions and dollarized tenders, maintaining interest rates, expat remittances, Gulf aid and Egypt’s tourism revenues could positively impact the exchange rate.
He also said that based on Nagm’s statements, there are no hints of new measures to be applied in the upcoming period for controlling black markets. But, due to political developments and economic actions, the exchange rates should stabilize along with the rest of the economy, Qura said.