CAIRO: Egypt's central bank kept the pound steady at 7.53 to the dollar at a foreign exchange auction on Wednesday, while the currency weakened slightly on the black market.
The central bank has kept the official exchange rate steady for more than two months after letting the pound weaken at the start of the year in an attempt to wipe out black market trading.
The bank said it offered $40 million at auction on Wednesday and sold $38.4 million at a cut-off price of 7.5301 pounds per dollar, unchanged from its last auction on Monday.
The central bank typically holds dollar auctions of $40 million every Sunday, Monday, Wednesday and Thursday. The auction did not take place on Sunday, when the bank instead sold $281 million in the interbank market to meet outstanding demand for staple commodities.
The rates at which banks are allowed to trade dollars are determined by the results of the official auctions, giving the central bank effective control over exchange rates.
One trader in the parallel market said the pound was trading at 7.65 on Wednesday, slightly weaker from the 7.63/64 to the dollar quoted on Monday.
Black market traders say volumes have fallen dramatically since the central bank's move against them and since it imposed a cap in February on the amount of dollars that can be deposited in banks.
The limit discourages use of the black market by depriving those who exchange dollars outside official channels from a place to keep their funds.
Comments
Comments are closed for this article.