The Egyptian currency fell to a seven-month low of 16.23 per dollar today, which is the fifth consecutive days of its decline after two months of trading almost unchanged.
The Egyptian pound, which compensated for some of its losses later in the trading session, fell 2.2 percent against the US currency since the beginning of the week, the largest weekly decline since March 2017.
James Swanston of Capital Economics said that the deviation of the Egyptian pound is far from the level of 15.7 pounds against the dollar, which has remained in it for most of the past few months, indicating that the Egyptian Central Bank has begun to loosen its grip on the currency.
Analyst at Renaissance Capital Ahmed Hafez, who expects the pound to drop to 17 against the dollar by the end of the year, said the move was not surprising, but "it is a little faster than we expected."
It was not immediately possible to contact the Central Bank for comment.
The Corona virus pandemic has affected some of the largest foreign exchange resources for Egypt in the past three months, especially tourism, which accounts for about five percent of gross domestic product and remittances from Egyptians working abroad. It also caused major foreign exchange outflows from domestic debt markets.
The Egyptian currency has declined only slightly since the beginning of the year. This contrasts sharply with other emerging market currencies, which have been affected by the crisis, with the Brazilian real falling by nearly 20 percent in 2020.
The Egyptian Minister of Planning said last month that the credit readiness agreement would help Egypt implement structural reforms that would help remove obstacles to private business.
The International Monetary Fund last month approved a $ 2.77 billion package through its rapid-financing tool to help Egypt reduce its balance of payments gap.