Egyptian pound steady at auction, stronger at exchange bureaus

Tuesday 21-07-2015 04:50 PM
Egyptian pound steady at auction, stronger at exchange bureaus

United States one dollar bills are curled and inspected during production at the Bureau of Engraving and Printing in Washington November 14, 2014. REUTERS/Gary Cameron

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CAIRO, July 21 (Reuters) - Egypt's central bank kept the Egyptian pound steady at 7.73 per dollar at a foreign exchange auction on Tuesday after a depreciation earlier this month. The pound was stronger at currency exchange bureaus.

The central bank said it had offered $40 million and sold $37.5 million at a cut-off price of 7.7301 pounds per dollar, unchanged from Thursday's rate. Sunday was a public holiday.

The central bank had held the pound at 7.5301 for the past five months until earlier this month, when it allowed it to weaken to 7.6301. On July 5, the bank let it slide a further 0.10 pounds.

Analysts say letting the pound weaken in a controlled way could boost exports and attract further investment, but also raises Egypt's large bill for imported fuel and food staples.

Egypt has sought to tame a once-thriving currency black market with measures such as a cap on dollar-denominated bank deposits.

Two traders at currency exchange bureaus said the pound was changing hands at 7.85 per dollar on Tuesday, stronger than the rate of 7.875/88 quoted on Thursday, though one trader said it was still trading at 7.88 on Tuesday.

The central bank gave banks permission in January to trade dollars up to 0.10 pounds more or less than the official rate, with an extra 0.05 pounds for currency exchange bureaus. (Reporting by Eric Knecht; Editing by Catherine Evans)

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