Egypt’s pound steady at FX sale, weaker at exchange bureaus

CAIRO: The Central Bank of Egypt (CBE) kept the pound steady at 7.73 per dollar in a foreign exchange (FX) auction Sunday, unchanged from its last sale, the bank posted on its website.

“The bank offered $40 million and sold 37.8 million at a cut-off price of 7.73 EGP per dollar,” said the central bank.

The dollar was sold at banks at 7.83 EGP on Sunday, while it was sold at (8.20-8.22) EGP at exchange bureaus, remarkably above the 0.15 EGP band allowed by the CBE, a trader told The Cairo Post.

The wider gap is a sign of a return of a dollar black market after months of recession.

Statements by Investment Minister Ashraf Salman at the Euromoney Egypt conference Monday that the “pound depreciation is not a choice,” created higher demand on the hard currency, leading the pound to fall against the dollar in the black market on speculation of a third devaluation in 2015, experts and traders told The Cairo Post.

Earlier in July, the CBE allowed the local currency to weaken in two consecutive depreciations in less than a week each by 0.10 EGP, after holding it steady at 7.53 per dollar for five straight months.

The last move dragged the pound to its lowest level since the CBE started FX auctions in December 2012.

Egypt’s central bank usually holds FX auctions on Sunday, Tuesday and Thursday every week. Such auctions determine the rates at which banks can sell the dollar to clients.

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