Egyptian President Abdel Fattah al-Sisi accepted the resignation of central bank governor Tarek Amer and appointed him as a presidential adviser, state television and al-Sisi’s office said on Wednesday.
Egypt’s dollar-denominated bonds fell as much as 1.6 cents on the dollar on the news, according to data from Tradeweb.
Amer, who has a banking background, was appointed for a four-year term as central bank governor in November 2015 and reappointed for another four years in November 2019. Governors are only allowed to serve for two terms.
State TV said Amer had stepped down “to allow others to complete the successful development process under the leadership of the President of the Republic.”
The move came ahead of a monetary policy committee meeting on Thursday evening where analysts polled by Reuters expect the overnight deposit rate to be raised by 50 basis points (bps) in order to keep inflation in check.
Egypt is also in the midst of negotiations for fresh financing from the International Monetary Fund.
Last month the IMF said Egypt needed to make “decisive progress” on fiscal and structural reform, and that greater exchange rate variability could have helped avoid a buildup of external imbalances and smooth adjustment to economic shocks.
On March 21, the central bank allowed the currency to weaken to about 18.45 to the dollar from its previous level of 15.70.
On Wednesday, the pound was trading at about 19.12 pounds to the dollar.
After emerging from the worst of the coronavirus-induced slowdown, Egypt’s economy suffered a new blow arising from Russia’s invasion of Ukraine, as investors pulled billions of dollars out of its treasury market and commodity prices surged.
Annual urban consumer inflation accelerated to a higher-than expected 13.6 percent year-on-year in July from 13.2 percent in June.