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Egyptian pound inches up on official, weakens slightly on black market
February 24, 2014 / 12:16 PM / 4 years ago

Egyptian pound inches up on official, weakens slightly on black market

CAIRO, Feb 24 (Reuters) - The Egyptian pound strengthened slightly at a central bank foreign currency sale on Monday.

On the black market the pound weakened slightly and traders said news that the government had resigned, a move that should pave the way for army chief Field Marshal Abdel Fattah al-Sisi to declare his candidacy for the presidency, had little immediate market impact.

“I don’t think this news will have much economic effect because it was expected and already factored in. Also it is expected that the key ministers, interior minister and most of the economic ministers, will remain,” said Moheb Malak, economist at Prime Securities.

“I don’t think this changes much. The policy of the transitional government is expected to remain in the same direction,” he said.

The central bank sold $38.6 million to banks with a cut-off price of 6.9509 pounds to the dollar, fractionally stronger than the cut-off price of 6.9511 from Thursday’s auction. The bank had offered to sell $40 million.

On the black market, the dollar was sold at 7.35 pounds on Monday, slightly weaker than the 7.33 pounds on Thursday.

The pound has been under pressure during three years of political turmoil. Foreign currency reserves were around $17 billion in January, down from $36 billion before the uprising that led to president Hosni Mubarak’s downfall in 2011.

The central bank introduced dollar currency sales over a year ago. Last month, it held a $1.5 billion exceptional auction, its largest ever, to restock the market with dollars and curb unofficial currency trading. (Reporting by Asma Alsharif; Editing by Susan Fenton)

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