CAIRO: Egypt's central bank held the pound steady against the dollar at its regular foreign currency sale on Tuesday, as the currency strengthened slightly on the black market. The bank sold $118 million at the unchanged rate of 8.78 per dollar.
Egypt is facing an acute dollar shortage which saw its foreign reserves fall to $15.5 billion in July, near a critical level that would cover only three months worth of imports.
A widening gap between official and black market rates for the dollar has increased pressure to devalue the currency. Two black market traders said they were selling dollars at 12.50 pounds per dollar, but did not give volumes of trade.
Egypt has reached a staff level agreement with the International Monetary Fund over a $12-billion three-year lending program that it hopes will plug its funding gap and restore market confidence as well as lure investment that could help ease its currency crunch.
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