(MENAFN - Arab News) Cairo: the egyptian pound hit a 10-month low as the central bank let the local currency weaken further while a persistent dollar shortage keeps prices on the black market high above official rates.
the bank said it sold 40 million at a cut-off price of 7.005 pounds weaker than the rate of 6.9976 pounds at its last sale on wednesday and the seventh drop in a row cbeo. the closely-linked interbank rate rose to 7.0149 pounds its weakest since july.
the rates banks are allowed to trade dollars at are determined by the results of the central bank sales giving the bank effective control over official exchange rates.
three years of political turmoil since the 2011 uprising against autocrat hosni mubarak have unnerved tourists and foreign investors leaving egypt's economy suffering from a persistent dollar shortage. tensions have ratcheted up further as presidential elections scheduled for may 26-27 draw nearer.
the central bank — propped up by dollar inflows from gulf allies — has in recent weeks allowed the pound to weaken. but it still trades markedly weaker on the black market where it stood at 7.50 per dollar on monday compared with 7.47 a day earlier.
egypt's foreign reserves rose to 17.414 billion in march from 17.307 billion in february. they stood at around 36 billion before mubarak was toppled.