Independence of Central Bank of Egypt and exchange rate regimes

Mustafa Kasim, Khaled Hussainey

Research output: Chapter in Book/Report/Conference proceedingChapter (peer-reviewed)peer-review


In this chapter, we assess macroeconomic independence using the prices of goods and services and short-term interest rates throughout a range of time periods categorised by alternative exchange rate regimes. To assess how well floating exchange rates have increased Egypt's macroeconomic independence from the EU and the US, the ARDL model (auto-regressive distributed lag) or Bounds Test has been devised. We examine a number of hypotheses concerning global transmission, interest rate and price movement, and international trade using this empirical methodology. According to the findings, Egypt's products market and monetary policy are, over the long term, completely independent from those of base countries like the European Union and the United States. Because of this, the Central Bank of Egypt (CBE) may decide its plan of action (policy direction) and define its goals without being impacted by shocks from the European Union and the United States (US).
Original languageEnglish
Title of host publicationHandbook of Banking and Finance in the MENA Region
EditorsKhaled Hussainey, Tamanna Dalwai
PublisherWorld Scientific
ISBN (Print)9781800614727
Publication statusAccepted for publication - 30 Dec 2022

Publication series

NameTransformations in Banking, Finance and Regulation
PublisherWorld Scientific
ISSN (Print)2752-5821
ISSN (Electronic)2752-583X


  • macroeconomics independence
  • goods market
  • monetary policy
  • Central Bank of Egypt
  • exchange rate regimes

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