US dollar hits LE13.10 on black market after Sisi’s speech

Foreign exchange traders working on Egypt's black market said the price of the US dollar jumped to more than LE13 just hours after President Abdel Fattah al-Sisi's speech in Alexandria on Monday.

Four traders said they are now selling dollars for between LE13.05 and LE 13.10 per dollar, weaker than last week's LE12.8, putting the pound at its lowest level since July.

Egypt's central bank held the pound steady against the dollar at its regular foreign currency sale on Tuesday, selling $118.6 million at an unchanged rate of 8.78 per dollar.

Amid speculation that the Egyptian currency will be devalued again soon, bankers say the increase in the price of the US dollar on the black market is unprecedented, .

One black market dealer told Al-Masry Al-Youm that the recent rise in the value of the dollar was prompted by Sisi's promise on Monday to lower the prices of basic commodities, regardless of the dollar exchange rate.

Egypt is facing an acute dollar shortage that sent its foreign reserves down to US$16.564 billion at the end of August.

It had roughly $36 billion in reserves before an uprising in 2011 overthrew veteran ruler Hosni Mubarak. That ushered in a period of political turmoil that scared away tourists and foreign investors, key sources of foreign exchange.

The widening gap between official and black market rates for the dollar has increased pressure to devalue the currency.

Egypt has reached an agreement with the International Monetary Fund on a $12 billion, three-year lending program that it hopes will plug the nation's funding gap and restore market confidence, encouraging investment that could help to ease the currency crunch.

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