(Bloomberg) -- Investors are bidding down Egypt’s currency by offering to sell it an all-time low level against the dollar.

The pound’s exchange rate was quoted at 19.5383 against the dollar on Monday, surpassing the level of 19.5186 reached in December 2016 following a devaluation that year, according to data from the Egyptian central bank. 

In the offshore market, the pound was trading less than 1% away from the record low of of 19.6725 also reached in 2016.

Egypt’s tilt toward a more flexible exchange rate has emboldened market participants to intensify pressure on a currency that remains expensive even after a 15% devaluation in March. It’s also getting increasingly caught up in a selloff of risk assets that deepened last week and stoked a surge in the dollar amid fears that heightened inflation would push interest rates higher and ignite a global recession.

The dollar’s rally has weighed on the currencies of Egypt’s trading partners and other developing peers. The Egyptian pound is on track for a seventh month of declines in September, its worst streak since 2013.

The nation is hopeful it can reach at least a staff-level agreement on International Monetary Fund assistance in the fourth quarter as it grapples with the economic fallout from Russia’s invasion of Ukraine. The Washington-based lender favors a more flexible exchange rate, and derivatives traders have been stepping up bets for a further depreciation.

Last week, Egypt’s central bank surprised most economists by refraining from a rate hike. Instead, it opted to raise the reserve ratios for lenders, an indirect form of tightening.

Policy makers are “now seemingly leaning towards a dovish stance,” Naeem Brokerage said in a report.

“The move could now be indicative of a lower probability of a sharp devaluation scenario, unless accompanied by other subsequent measures in the upcoming days or weeks,” Naeem’s analysts said.

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