Egypt devalues currency to avoid crisis
The move opens the way for an IMF loan considered crucial to prevent an economic meltdown again threatening to destabilise the most populous Arab country
CAIRO — Egypt took the dramatic step of allowing its currency to trade freely as it announced measures to stabilise an economy crippled by a dollar shortage that has raised concern about social unrest. Stocks jumped the most in eight years and the pound slumped after the central bank’s decisions, which included raising its two benchmark overnight interest rates by three percentage points. They came after months of negotiations with the International Monetary Fund (IMF) over a $12bn loan that is seen as crucial in western capitals to preventing an economic meltdown that could destabilise the most populous Arab country. "It’s a historic move for Egypt," said Hisham Ezz Al Arab, chairman of Commercial International Bank Egypt, the country’s biggest lender listed on the stock exchange. He spoke after a meeting of top bank executives with the central bank. "It proves the government is serious about the reform." Egypt has struggled to revive its economy since the 2011 uprising that ended ...
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