USD exchange rate to reach LE16 by 2018-end: Pharos Holding

CAIRO – 13 July 2017: The U.S. dollar exchange rate is expected to fall to an average of LE 16-16.5 by the end of 2018, Pharos Holding said in a Wednesday research note.

For the current fiscal year, the U.S. dollar will register an average of LE 17.9, Pharos Holding’s economist Ramy Oraby pointed out. Oraby expected the Egyptian pound to remain undervalued for some time. He reported, “not to hurt Egypt’s competitiveness.”

The government’s budget for fiscal year 2017/18 calculated the dollar exchange rate at LE 16, Minister of Finance Amr El-Garhy said in March. He is also assuming a strengthening of the pound, which is currently at LE 17.82 for buying and LE 17.95 for selling.

The government made a decision in November to float the local currency in a move aimed at reviving an economy badly hit by political instability and a foreign currency shortage.

The pound’s flotation was part of an economic reform program that also included levying a value-added tax and slashing energy subsidies. Shortly after the flotation, the pound lost almost 50 percent of its value against the dollar.