Egyptian pound steady at official auction, weaker at exchange bureaus

CAIRO – ArabTelegraph – Egypt’s central bank kept the pound steady at 7.73 per dollar at a foreign exchange auction on Tuesday, and the currency was slightly weaker at exchange bureaus.

The central bank said it had offered $40 million and sold $37.8 million at a cut-off price of 7.7301 pounds per dollar , unchanged from the rate at the last auction on Sunday.

The central bank kept the pound at 7.5301 for five months until last month, when it allowed it to weaken to 7.6301. On July 5, the bank let it slide a further 0.10 pounds.

Letting the pound weaken in a controlled way could boost exports and attract further investment, but also raises Egypt’s already large bill for imported fuel and food staples.

Two traders at exchange bureaus said the pound was changing hands at 7.96/97 pounds per dollar, slightly weaker than the 7.94/95 quoted on Sunday.

The central bank gave banks permission in January to trade dollars up to 0.10 pounds above or below the official rate, with currency exchange bureaus allowed to trade at 0.15 pounds above or below the official rate.

Egypt has sought to tame a once-thriving currency black market with measures such as a cap on dollar-denominated bank deposits.