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Egypt's pound strengthens as demand for dollars by importers eases

Egypt's pound strengthens as demand for dollars by importers eases

Egypt

Egypt pound has strengthened slightly at banks as demand for dollars slightly goes down.

A dollar was being exchanged for around 18 pounds down from around 19 a week ago at most banks. This also saw banks paying clients around 17.8 per dollar.

Most banks have been raising prices to attract dollar inflow due to a low dollar request from many clients, but the demand increased since the past one week.

While banks are prioritizing imports of essential goods, private individuals are forced to buy dollars on the black market. Three traders on the black market said they were selling dollars at a range of 19.60-19.80 per dollar.

Egypt’s central bank abandoned its currency peg of 8.8 pounds to the U.S. dollar on Nov. 3, hoping to unlock currency inflows and bring back foreign investors who were driven away after the 2011 uprising that ousted Hosni Mubarak.

Under the currency peg, dollar supplies were rationed by the central bank, forcing businesses to go to the black market for foreign currency.

Bankers say it will take time for those dollars to be absorbed back into the banking system.

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