The Central Bank of Egypt (CBE) provided banks working in the local market with $104.5m on Tuesday through the launch of its first collective auction to sell dollars to banks.
On Sunday, the CBE decided to modify the auction system of selling dollars to banks; it decided to offer one auction worth $120m every Tuesday, instead of providing three separate auctions on Sunday, Tuesday, and Thursday at a value of $40m each.
During Tuesday’s auction, the CBE set the value of the dollar at EGP 8.78 for the second time consecutively. The dollar was nominally devalued to EGP 8.78 during the Wednesday session, after it was set at EGP 8.85 on Monday 14 March.
On Tuesday, the official dollar price in banks was EGP 8.83 for purchasing and EGP 8.88 for selling.
Traders in exchange companies said the dollar value in the informal market exceeds official rates by approximately 50 piasters.
The credit rating company “Fitch Ratings” confirmed in a press release on Monday that CBE’s reduction of the pound’s value against the dollar has pushed the official value of the US currency closer to that of the informal market, in which the dollar is traded for approximately EGP 9.50.
Fitch expects CBE to reduce the value of the pound against the dollar during the upcoming period. The dollar may exceed EGP 9 in the official market by the end of 2016, Fitch projected.