Egypt pound weakens against dollar, dropping to 7.73 in state auction - state agency

Sunday 05-07-2015 02:34 PM
Egypt pound weakens against dollar, dropping to 7.73 in state auction - state agency

American dollar notes are displayed in this photo illustration in Johannesburg August 13, 2014. REUTERS/Siphiwe Sibeko


CAIRO, Jul 5 (Aswat Masriya) - The Egyptian pound weakened to 7.73 against the dollar in a central bank auction on Sunday, dipping by 10 more piasters since Thursday's drop, state news agency MENA said.  

The central bank sold 36.5 million dollars at 7.73 pounds per dollar, a bank official told MENA.    

Meanwhile in banks, the pound hit a record-low of 7.83 against the dollar. 

On Thursday, Egypt's central bank allowed the pound to drop to 7.63, losing 10 piasters on the current price at the time, 7.53.

Foreign exchange auctions are held by the central bank every Sunday, Tuesday and Thursday. This makes the drop at Sunday's central bank auction, the second in a row. 

Two investment bank analysts told Aswat Masriya on Thursday that the drop was an expected measure, given that the pound trades at a higher price than its fair value at a time when Egypt is trying to attract dollar inflows. 

On January 18, the central bank allowed the Egyptian pound to weaken in front of the U.S. dollar for the first time in six months.

It said the step was taken to eliminate the unofficial currency market, known as the black market.

In a second blow to the black market, the central bank capped on February 5 the amount of dollars that can be deposited in banks.

Central Bank Governor Hisham Ramez announced in an economic conference last March that "there is no black market in Egypt in the time being."

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