Egypt Central Bank keeps pound steady at weekly auction

Tuesday 11-10-2016 01:29 PM

Egypt's pound notes are pictured in stacks of 100 as employees count money at an exchange office in downtown Cairo June 5, 2014. REUTERS/Amr Abdallah Dalsh

CAIRO, Oct. 11 (Aswat Masriya) – The Central Bank of Egypt (CBE) kept the Egyptian pound steady against the dollar at Tuesday's weekly auction of foreign currency, quelling speculation of a devaluation for the second week in a row.

The central bank said it sold $120 million at the weekly sale, with the cut off price stable at the official rate of 8.78 pounds per dollar, MENA reported.

The CBE quelled expectations of an imminent devaluation as Egypt struggles to close the gap with the black market rate, which reached EGP 15 to the dollar on Tuesday.

Last week, Egypt announced that its net foreign reserves also jumped to $19.59 billion at the end of September, its highest in over a year. The central bank governor has said he would consider letting the pound float freely if reserves exceed $25 billion.

The country had roughly $36 billion in reserves before the 2011 uprising.

Egypt is due to receive a $12 billion loan from the International Monetary Fund (IMF). Earlier this week, IMF chief Christine Lagarde said that Egypt has “almost completed” prior actions necessary for the iMF’s board to formally approve the loan.

In March, the Central Bank of Egypt devalued the pound by about 14 percent to reach EGP 8.78 against the dollar in an effort to close the gap between the official and parallel rate. 

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