Egyptian pound weakens

The Egyptian pound held steady against the dollar at an official foreign currency auction on Tuesday but weakened significantly on the black market as uncertainty over monetary policy grows. Egypt, which depends heavily on imports, is facing a foreign currency crisis and is under increasing pressure to devalue the pound, but the bank surprised markets when it strengthened the pound by 20 piasters in November and held it steady ever since.
The central bank sold $38.8 million at a cut-off price of 7.7301 pounds to the dollar on Tuesday, unchanged from the previous auction. But the black market rate jumped, with traders quoting a range of 9.30 to 9.34 to the dollar, up from levels of 9.17 to 9.22 quoted on Sunday. Trading for dollars in the black market is now limited to regular customers, traders said, with many exchanges fearing a crackdown after several were closed down in February. Egypt has been starved of foreign currency since an uprising in 2011 ousted autocrat Hosni Mubarak but drove away tourists and foreign investors - major sources of hard currency.