Economic Research Forum.

Abstract EN

The aim of this paper is twofold.

The first is to empirically assess whether there has been any significant change in exchange rate determination after the announcement of the float.

The second is to provide a de facto classification for Egypt’s exchange rate regime.

Both contributions were not addressed in previous empirical work.

They are also timely since the Central Bank of Egypt (CBE) has announced in 2005 to move to an inflation targeting framework in the medium-term.

Should the CBE decide to move in this direction, exchange rate concerns should only be addressed only if they are not in conflict with price stability.