The EGP float caused the government to spend over EGP 100 bn more than it planned in FY2016-17, three sources told Reuters. The increased spending was needed to cover additional cost of importing fuel and wheat. Higher borrowing costs were also a factor, and the government will now seek parliamentary approval for the overspend, the sources aid.

On a positive note, Egypt’s banking sector had drawn in USD 56 bn from depositors since the EGP float, CBE Deputy Governor Gamal Negm said, according to AMAY. Last week, to mark the “float-a-versary,” CBE governor Tarek Amer had said inflows have risen to USD 80 bn since last November. Foreign investment in Egyptian securities has increased to USD 18.8 bn in October since the EGP float last November, a Finance Ministry official told Reuters on Thursday. Meanwhile, remittances from expatriates rose 24.4% y-o-y to USD 1.17 bn for the month of September,according to Reuters. August had seen a rise of 40% y-o-y which brought the total since the float to USD 16.3 bn, a rise of 17.3% for the same period a year before.

Proof a floating currency works: “Egypt’s transition from a struggling economy to one of Africa’s revival stories in 12 straight months is adding to evidence that a free-floating currency works,” writes Bloomberg’s Srinivasan Sivabalan. “Economic expansion has accelerated to the fastest pace in seven years, non-oil exports and tourism are growing at double-digit rates and stocks trade near record highs. All without the central bank having to spend a fortune defending the currency,” he added.