CAIRO: The Egyptian pound held steady at an official auction on Thursday but firmed on the black market after the central bank eased restrictions on withdrawals and deposits of hard currencies at banks.
The central bank held the pound steady at 7.7301 pounds per dollar, selling $38.8 million, at Thursday's official auction.
On the black market the pound strengthened to a range of 9.60- 9.65 pounds per dollar from around 9.7 pounds on Tuesday, three traders told Reuters, without revealing trade volumes.
On Tuesday and Wednesday the central bank lifted caps on withdrawals and deposits of foreign currencies for individuals and companies importing essential goods, while keeping them in place for other corporates.
Last Sunday the central bank held an exceptional auction, offering $500 million to cover imports of strategic goods.
The additional liquidity also had an impact in lowering the price of the dollar on the parallel market.
"The price for the dollar started falling quickly on the market," one trader told Reuters.
In an attempt to keep black market rates in check, the central bank held a second meeting with foreign exchange bureaus this week to put a cap on prices for the dollar on the black market.
Egypt, which depends heavily on imports, is facing a foreign currency crisis and is under increasing pressure to devalue the pound, which the central bank has been keeping artificially strong through its weekly auctions.
The country has been starved of hard currency since a 2011 uprising ousted autocrat Hosni Mubarak from power and drove away tourists and foreign investors - major sources of hard currency.
A year ago, the central bank imposed strict controls on hard currency movements, including a cap of $50,000 a month on cash deposits to fight a black market, but it has since eased them as the currency crisis worsened and imports started piling up at ports.
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