The Clap
The IMF is keeping a close eye on Egypt’s shift to a flexible exchange rate.
What
The IMF approved a $3 billion support package for Egypt, with one of the conditions being a “permanent shift” to a flexible exchange rate regime.
So what
The IMF expects Egypt to implement structural reforms to reduce the state’s influence in the economy and boost the private sector, with steps towards this potentially becoming prerequisites for future disbursements.
Now what
The IMF also expects to see daily volatility in the exchange rate similar to other floating exchange rate regimes once the letter of credit requirement is lifted.
