The Central Bank of Egypt (CBE) has suspended five foreign exchange bureaus after finding them guilty of manipulating and speculating on the prices of foreign currencies.
This comes one day after the CBE revoked the license of one foreign exchange office and suspended six others over similar reasons.
Monday’s decision included the suspension of three bureaus for one year, namely el-Gawhara, al-Malek and al-Fardous. The Egyptian Saudi Bureau was suspended for 8 months, while Alexandria Exchange Office faces a six-month suspension.
According to state run news agency MENA, the total number of foreign exchange bureaus that have recently had their licenses revoked stood at 26, while 21 offices have faced temporary suspension.
Earlier in August, the CBE shut down 10 foreign exchange offices for a year after they were found guilty of repeatedly manipulating and speculating on the price of the US dollar in the country’s parallel currency market.
Egypt is facing a dollar shortage with sources of hard currency inflows like tourism and investment slowing down.Driven by the shortage, rates on the black market reached unprecedented levels of EGP 13 to the dollar in July while banks kept the pound steady at 8.88.
But the pound was strengthened to a range between EGP 12.40- 12.70 after the government announced that it is in talks with the International Monetary Fund (IMF) to secure a $12 billion loan.
Fitch Ratings said that securing the IMF funding deal would be credit positive for Egypt.
Egyptian President Abdel Fattah al-Sisi said last week that Egyptians would “very soon” be able to purchase U.S. dollars at a unified rate.
Years of political turmoil led to a drop by more than a half of Egypt’s foreign reserves in the years following the popular uprising in January 2011, which ended the rule of President Hosni Mubarak. The instability that ensued has driven tourists and investors away.
Credit: All Africa