Egypt’s Currency Black Market to be gone in a year: Ramez

Egypt’s central bank chief vowed to stamp out the black market for foreign currency within a year as he sought to ease investor concerns about a possible devaluation of the pound.

“Big volatility is not in our cards for a good time,” Central Bank Governor Hisham Ramez told a visiting U.S. trade delegation in Cairo yesterday. He was responding to questions from the delegates, which were mostly focused on the currency.

The central bank manages the float of the Egyptian pound, and its official exchange rate hasn’t changed for almost five months. On the black market, though, the currency slid to a 16-month low yesterday, and some economists say a devaluation is likely. Egypt’s foreign reserves are still less than half their level before the uprising of 2011, which has been followed by four years of political turmoil and economic stagnation.

On the official interbank market, the pound has fallen 2.8 percent this year to 7.1501 per dollar. In unregulated trading, it has been declining for a month and weakened to 7.58 a dollar from 7.532 last week, according to Bloomberg’s weekly survey of money changers.