(MENAFN- The Peninsula) Reuters
CAIRO: Egypt's currency, the pound, is steadily approaching a historic low against the US dollar, according to Refinitiv data.
Foreign currency has dried up in Egypt over the last six months, forcing banks and importers to scramble to find dollars to pay for imports.
Dollars have disappeared in part because of the higher cost of imported commodities, a drop in Russian and Ukrainian tourists and a flight of dollars from Egyptian treasury markets, with many economists saying the Egyptian currency is overvalued.
The pound was trading between 19.44 and 19.53 to the dollar on Wednesday. The record low was on Dec. 21, 2016, when it weakened to 19.80 pounds during intraday trade, according to Refinitiv.
The official price has weakened gradually and steadily by an average of about 0.01 Egyptian pounds ($0.0005) to the dollar per business day since May 25.
Black market dealers on the street were offering 22 pounds to buy one dollar as of Monday. Higher volume traders were offering to sell dollars at 23.25 and sell pounds at about 22.35, bankers said on Wednesday.
Egypt has been negotiating for a financial package from the International Monetary Fund since March to help it shore up its financial position.
Economists and bankers say Egypt's newly appointed acting central bank governor Hassan Abdalla faces a decision on how quickly to let the pound depreciate as Egypt negotiates the IMF loan.
The IMF said in March that greater exchange rate variability could have helped Egypt avoid a buildup of external imbalances and facilitate adjustment to economic shocks.
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