CAIRO, June 9 The Egyptian pound strengthened
slightly against the dollar at a central bank sale on Monday and
remained stable on the black market a day after former army
chief Abdel Fattah al-Sisi was sworn in as the country's new
Sisi, who toppled Egypt's first freely elected leader last
July following mass protests, is joining a long line of leaders
drawn from the military and enjoys the backing of wealthy Gulf
Black market traders have cited hopes of new investment and
aid from Gulf countries as a reason why demand for hard currency
On the black market, the dollar changed hands at a rate of
7.25/27 on Monday, in line with last week's rate.
Narrowing the gap between official and unofficial rates, the
pound has strengthened markedly in the black market since Sisi
was elected on May 29. It had traded for around 7.50 to the
dollar before his election victory.
The central bank said it sold $37.6 million at a cut-off
price of 7.1402 pounds, inching up from 7.1403 at its
last sale on Thursday. It had offered $40 million.
Business leaders have cited clarity on the direction of the
currency as a condition for further investment.
Egypt's central bank governor Hisham Ramez was quoted by
state media on Saturday as saying that the bank's forex policies
were succeeding in restoring stability to the currency market
and would lead to the elimination of the black market.
Forex traders and economists have described the central
bank's decision to allow the pound to gradually weaken since
March as a managed depreciation. The central bank has not said
why it has been letting the currency weaken.
The rates at which banks are allowed to trade dollars
are determined by the results of the central bank sales,
giving the bank effective control over official exchange rates.
Egypt's foreign reserves fell to $17.284 billion at the end
of May from $17.489 billion in April, the central bank said on
Thursday. It had sold $1.1 billion at an exceptional forex
auction on May 14.
May's dollar reserves compared with a cushion of over $35
billion in reserves before the 2011 uprising that swept veteran
autocrat Hosni Mubarak from power and started three years of
political turmoil that unnerved tourists and investors, two main
sources of dollar inflows.
(Reporting By Shadia Nasralla; Editing by James Macharia and