A man counts Egyptian pounds at currency exchange shop in downtown Cairo on November 3, 2016. AFP / KHALED DESOUKI
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The honeymoon period for Egypt's pound may be nearing an end. Nearly four months after a free float opened the floodgates for overseas funds and made the currency the world's best performer this year, the government got an unpleasant jolt. Lured by a cheaper currency and a Middle East-record $12 billion International Monetary Fund loan agreement signed by Egypt in November, foreign holdings of Egyptian T-bills doubled to 21.7 billion pounds ($1.4 billion) in January from a month earlier, according to central bank data."Yields on Treasury bills are very attractive, especially since there does seem to be a shift within the government toward more orthodox policymaking and with an International Monetary Fund deal in place," said economist Jason Tuvey, the Middle East economist for London-based Capital Economics. He expects the pound to rise to as strong as 14 per dollar this year.
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