How far and how quickly will the Egyptian pound fall?

With the Central Bank of Egypt (CBE) loosening its grip on the pound, the key question is whether the authorities will succeed in overseeing an “orderly” devaluation of the currency. If an IMF deal can be secured we think they stand a good chance, although the pound is still likely to fall by around 15%, and history suggests that the adjustment is likely to be relatively rapid. But without IMF support, there is a real risk of a more disorderly devaluation, whereby the pound could plunge by up to 50%.