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Egyptian pound remains stable against US dollar in weekly auction

CBE has been holding a weekly auction since March, offering $120 million, to sell USD to local banks, in an attempt to provide hard currency for imports

Ahram Online , Tuesday 23 Aug 2016
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The Central Bank of Egypt (CBE) has maintained on Tuesday a stable rate of the Egyptian Pound at 8.78 against the US dollar in its weekly forex auction, state news agency MENA reported.

CBE has been holding a weekly auction since March, offering $120 million, to sell USD to local banks, in an attempt to provide hard currency for imports. Last week the bank sold $118 million.

Egypt, which relies heavily on imports, particularly foodstuffs, has been suffering an acute shortage of US dollars in the wake of political and security unrest following the 2011 revolution which has discouraged tourists and foreign investors, two major sources of hard currency.

The country's foreign reserves more than halved since 2011 to reach $15.5 billion in July, with the government currently seeking a $12 billion fund facility over a three-year period from the International Monetary Fund to support the ailing economy.

In an attempt to revive the economy, Egypt recently reached a staff-level agreement with the International Monetary Fund (IMF) for a $12 billion fund facility over a three-year period to support the ailing economy.

IMF mission chief Chris Jarvis previously told Ahram Online that "all IMF-supported programmes have to be fully financed."

"In Egypt’s case, we would be looking for commitments of around $5 billion to $6 billion from bilateral creditors before the programme is brought to the board so that we can be sure that the programme is fully financed."

On Monday, UAE has offered a deposit worth $1 billion to the Central Bank of Egypt (CBE) lasting for six years.

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