Egyptian pound steady at official auction, stronger on black market

The Egyptian pound held steady at a central bank dollar sale on Sunday, but strengthened on the unofficial market after the government established a fourth weekly dollar auction.

The bank offered $40 million and said it had sold $38.2 million at a cut-off price of 7.1401 pounds a dollar, a rate unchanged from its last sale on Thursday.

The rates at which banks are allowed to trade dollars are determined by the results of central bank sales, giving the bank effective control over official exchange rates.

In the unofficial market, the pound was trading at about 7.70 to the dollar on Sunday, stronger than Thursday's rate of about 7.74 to the dollar, one trader said.

Sunday's sale is the first since the government announced it would add a fourth weekly auction to those it already holds on Monday, Wednesday and Thursday.

The bank did not give a specific reason for adding the sale, but the central bank governor said last month he would take measures to calm the parallel market in the Egyptian pound, which has grown in recent weeks, but he gave no details or time frame for action.

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