The Egyptian pound will not collapse and its incremental depreciation has stabilized, a senior aide to Islamist President Mohamed Mursi said on Sunday.
Essam Haddad, Mursi's deputy chief of staff and foreign policy adviser, told Reuters in an interview that he did not expect the pound to fall further after it lost more than 8 percent against the dollar since the start of the year.
"I think it has reached a level of stability," he said.
"So as long as it (depreciation) is going incrementally and in a way that is market-sensitive, then there is no harm in this," Haddad said.
More than two years of political instability following the overthrow of President Hosni Mubarak in 2011 has triggered a flight into dollars. The Egyptian pound has faced extra pressure since late last year, when violent protests against President Mohamed Mursi erupted, setting back hopes for economic recovery. (...)
A black market in hard currency has sprung up in recent weeks due to a shortage of dollars, with street traders quoting the pound at more than 7 to the dollar compared to an official rate of 6.73.
Regulated foreign exchange bureaux are swamped by demand for dollars and cannot meet the demand, the head of the foreign exchange department at the Chambers of Commerce