CAIRO: Egypt's central bank looked set to keep the pound steady against the dollar on Tuesday at its first foreign currency sale since raising its benchmark interest rate by one percentage point last week, five bankers told Reuters.
The Monetary Policy Committee raised the overnight deposit rate unexpectedly on Thursday to 11.75 percent, its highest in more than a decade and increased the overnight lending rate by 100 basis points also to 12.75 percent, its highest since 2008.
The move was aimed at curbing inflation - now at seven-year highs over 12 percent - and stablising the currency, which is selling at about 11 to the dollar on a flourishing black market.
Egypt devalued the pound by 13 percent in March to relieve mounting downward pressure and has held it at roughly 8.8 to the dollar since then.
The bank holds a sale every Tuesday at which it allocates about $120 million to Egyptian banks. That is not enough to meet demand from importers, pushing many to pay a premium for dollars on a black market that the central bank is struggling to crush.
The bank will officially announce the rate later on Tuesday.
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