CAIRO: The central bank let the Egyptian pound depreciate for the first time in five months on Thursday, a move analysts said would please the international investors that Cairo is courting. The bank said it sold $38.8 million at a cutoff price of 7.63 pounds per dollar at a regular auction, sending the currency to its weakest level since auctions began in December 2012.
The new rate is 1.3 percent weaker than the rate of 7.53 pounds at the previous auction on Sunday.
Letting the pound weaken in a controlled manner again after doing so over a few weeks earlier this year could boost exports and attract further investment, analysts said.
At the same time, a weaker currency could raise Egypt's large bill for imports, which many Egyptians rely on for fuel and food staples.
Egypt is trying to rebuild its economy after four years of turmoil with a series of investor-friendly reforms including reducing subsidies and introducing pro-business regulations.
But hopes of a quick turnaround have been hit by continuing violence.
And questions remain over the availability of foreign currency, even as some investors signed billions of dollars worth of deals at an investment summit in March. "We have a problem with availability of dollars so we need to have a weaker currency to attract capital," said Mohamed Abu Basha, economist at EFG-Hermes in Cairo.
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