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Building Hard Currency Resources Begins with Production, Not Defending the Exchange Rate

During his speech at the Egypt 2026 Forum, the Governor of the Central Bank asserted that the health of the currency market is tied to the strength of the real economy and its capacity to export and attract investments. He considered that attempts to peg the dollar exchange rate—which crossed the 55 EGP mark—are a page of the past following the decisive shift toward a flexible exchange rate system in 2024.

Why Did the Fixed-Rate Bet Fail in Egypt?

The Governor revealed that the policy of pegging the currency to a fixed rate requires strict and difficult conditions that were not domestically available, such as concentrating foreign trade with a single partner, possessing an enormous abundance of foreign reserves, and aligning inflation rates. He noted that the floatation gave the private sector a broader space to breathe and engage in real production.

A Relentless War Against Inflation and Market Dualism

The Central Bank warned of the danger of having two currency markets and their direct impact on soaring prices and the cost of living. He stressed that the radical remedy lies in curbing inflation and activating supply and demand mechanisms to generate real, sustainable inflows of foreign currency