Egypt's Central Bank governor says it's a turning point in the country's economy. Devaluing its currency is one of the requirements laid out by the International Monetary Fund (IMF), in order for Cairo to receive a $12bn loan.
The cash-strapped government has also raised fuel prices, and plans to cut back on subsidies for consumer goods.
The IMF says allowing the Egyptian pound to trade freely will attract foreign investors. But for many people it is a bitter pill to swallow.
Inflation and unemployment are already high, and there are fears that the currency devaluation will cause the price of food and services to soar.
The UN says more than a quarter of Egypt's population lives below the poverty line.
Frustration about the rising cost of living has prompted calls for demonstrations to protest against the government's handling of the economy.
Will the currency devaluation and other controversial financial reforms help the ailing economy?
Presenter: Dareen Abughaida
Angus Blair - President of the Signet Institute.
Ahmed Badawi - Senior researcher, Centre for MENA Politics at Free University.
Dalia Fahmy - Senior fellow, Center for Global Policy.
Source: Al Jazeera