Its central bank in February imposed a requirement for letters of credit for most imports, causing a sharp slowdown in imports and a backlog of goods in ports. This has prompted some importers to buy bullion in Egyptian pounds in order to export abroad as a means to access dollars, a move which Hani Milad, head of the gold division at FEDCOC, said fuelled the price increase.
Egypt continues to face a foreign currency shortage despite two major devaluations this year, with the gap between the official rate of the Egyptian pound against the dollar and that on the black market widening. Its central bank in February imposed a requirement for letters of credit for most imports, causing a sharp slowdown in imports and a backlog of goods in ports.