Egyptian Central Bank Intervenes To Prevent FX Rout

Tyler Durden's picture

In a world in which every central bank is laser-focused on destroying its currency, interventions that serve to stabilize currencies are a fond memory. Yet that is precisely what the Egyptian Central Bank did earlier after it intervened directly in the FX market to support the EGPUSD after it plunged to lows of 0.168. Subsequent to the intervention the pound jumped modestly to 0.1701, which only means that the intervention support level will be promptly taken out in the next four days if not hours. The inverse spot rate is 5.8789, which as we predicted a few days ago is about to surge far higher, even when taking Ben Bernanke's admonitions that the ECB has no choice but to keep its currency weak. Of course, a plunge in the EGP simply means that food will get all that much more expense, and let's remember for a second just what was the reason for the revolution in Egypt to being with...