The growing popularity of a strange form of debt diplomacy

Reality caught up with the Egyptian pound on October 27th. Since Russia invaded Ukraine, prompting foreign investors to flee risky assets, the country’s central bank has burnt through its foreign reserves in a bid to keep the currency fixed against the dollar. But last week officials agreed to float the pound—the first of several concessions to secure a $3bn loan from the imf. The currency promptly fell off a cliff, plunging to an all-time low.