Egyptian pound steady at official auction, weaker at exchange bureaus

Reuters , Thursday 27 Aug 2015

Egypt"s pound notes are pictured in stacks of 100 as employees count money at an exchange office in downtown Cairo in a file (Reuters)

 Egypt's central bank kept the pound steady at 7.73 per dollar at a foreign exchange auction on Thursday, and the currency was 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 Tuesday.

The bank kept the pound at 7.5301 for five months until last month, when it allowed it to slide to 7.6301. On July 5, the bank let it slip 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 8 pounds per dollar, weaker than the 7.96/97 quoted on Tuesday.

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. 

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