Egypt’s pound has been battling to recover after hitting a record low against the US dollar this week.
The freefall started when the country’s central bank hiked interest rates by 600 points and devalued the currency.
The country’s key interest rate now stands at 27.25% – a blow for those wanting to borrow money.
However, while the latest figures are not good news, Egypt’s monetary policy committee says the moves should begin to anchor inflation, which hit almost 34 percent in 2023.
Reports say the steps are also meant to facilitate an agreement with the International Monetary Fund.
The IMF has confirmed the extension of its current $3 billion financial support package for Egypt.
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However, the latest moves have proved disastrous for the local currency, which dropped to around 50 to the dollar from around 30 pounds.
The Egyptian pound has been under pressure as the country is facing a protracted shortage of foreign currency.
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But, there is relief on the horizon.
An investment deal signed last month with the United Arab Emirates worth $35 billion should see this situation change.
Analysts at S&P Global Market Intelligence also expect further monetary tightening in 2024 to combat inflation and offset the price increases stemming from Egypt’s weakened pound.
The US and UK are expected to start deceasing their rates soon after an extended period to stop inflation.
However, Egypt is not part of this global cycle and has been fighting its own domestic financial pressures.
