As usual, exchange rate fluctuations are hard to explain. But some longer lastig trends might be behind the evolution. Emerging market currencies weakened against the dollar over the past months, except the Egyptian pound. Thus, the current development might be explained in terms of somme sort of catching up to other countries. The depreciation is tolerated by the central bank to narrow the gap between the official exchange rate and the black market price of the US dollar. The depreciation can contribute to reduce uncertainty, as the pound is seen to be overvalued. A depreciation can be also justified with respect to the weakness of the euro.

What is surprising is, the artificial appreciation of the Egyptian pound and the form of managed floating the CBE did undertook during the last months, however now it slowly starting to lose control over it. This incurred Egypt fortunes of foreign money to back the Egyptian pound against other currencies, the fragility of the artificial appreciation of EGP has been witnessed from the upsurge of US dollar rate because of fall in oil prices. Unsurprisingly, the CBE failed to back EGP more, and the Egyptian pound starts and will continue to be re-evaluated based upon real market forces of supply and demand. So I would expect even larger depreciation to come !

If we look back 60 days span, something happened 25 days ago. There is a shift in direction of the exchange rate. This change did not show "significance" until about 8 days ago where the current rate starts to significantly move away from its 60 days mean using 95% CI. If we wait-and-see for another 30 days, we could test for error correction to see if there would be mean reverting---if not whatever reason behind the change would have been integrated into the series. There might be regime change. Policy-wise the government may be shifting policy.

It is worth noting that for the first time in 5 years, in 2014 Egypt's export volume growth became positive 3.66% and its long-running negative current account balance is at all time low at the end of 2014. However, other fundamentals, such as inflation and investment rate do not manifest any significant change. This recent change in exchange rate may be an export-stimulating package---Egypt's export volume has been negative for the past 5 years and saw positive growth in 2014. This new exchange regime may be optimizing that momentum.

http://www.exchangerates.org.uk/USD-EGP-exchange-rate-history.html