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(FILES) In this file photo A man counts Egyptian pounds at currency exchange shop in downtown Cairo on November 3, 2016. - With Egypt's economy in crisis, the currency in freefall and inflation skyrocketing, the poor have been hit hard but the middle class is also teetering on the brink. The Egyptian pound has lost half its value against the dollar since March, following a devaluation demanded as part of a $3 billion International Monetary Fund loan agreement. Official annual headline inflation hit 21.9 percent in December, and food prices surged 37.9 percent in the Arab world's most populous nation. (Photo by KHALED DESOUKI / AFP)
Egypt has to apply a combination of monetary and financial policies to restore economic stability, the Financial Counselor and Director of the Monetary and Capital Markets Department of the International Monetary Fund (IMF) Tobias Adrian told Asharq Business in an interview on April 12th.
Adjusting the exchange rate of the Egyptian pound is a key factor to achieve economic stability in the country, as it allows the central bank to implement favorable monetary policies to local conditions, Adrian said on the sidelines of the Spring Meetings of the IMF and World Bank in Washington.
Adrian added that the Central Bank of Egypt (CBE) have to reach the inflation target in one way or another, pointing out that there are still more steps required to achieve this.
He also noted that Egypt received more than one external and internal shock, foremost of which was the increase in global commodity prices, particularly food, and whilst country’s tourism sector did not rebound as expected.
On April 11th, the IMF cut its forecast for Egypt’s real gross domestic product (GDP) for the current fiscal year (FY) 2022/2023 to 3.7% from its previous projection of 4%.
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