Egyptian pound steady at dollar sale, weaker at parallel market

 The Egyptian pound was stable at a dollar sale on Tuesday, as the central bank sold $37.8 million at a cut-off price of LE7.9301  per dollar, but it weakened on the parallel market.

The official cut-off price was unchanged from Sunday's dollar sale, but one trader said the dollar changed hands at LE8.50 in the parallel market on Tuesday, compared with LE8.40 on Sunday.

Egypt announced last month that the central bank governor, Hesham Ramez, would be replaced this month by senior banker Tarek Amer. The move was welcomed by traders, who expect a new approach to the country's currency crisis.

Egypt has sought to tame a once-thriving currency black market with measures such as a cap on dollar-denominated bank deposits.

The central bank gave permission in January to trade dollars up to LE0.10 above or below the official rate, with currency exchange bureaux allowed to trade at LE0.15 pounds above or below the official rate.

The central bank kept the pound at 7.5301 for five months until July, then allowed it to slide to 7.7301. This month, it let it weaken by another LE0.20 to 7.9301.

Allowing a controlled weakening of the pound could boost exports and attract further investment, but it would also raise Egypt's already large bill for imported fuel and food staples.

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