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Wednesday, 27 April 2016

CBE sells USD 118.7 mn in its FX auction, keeps exchange rate unchanged

The CBE sold USD 118.7 mn in yesterday’s FX auction at the regular rate of EGP 8.78 per USD 1, Reuters reported. The newswire added that the EGP strengthened on the black market to EGP 10.40-10.50 per USD 1, down from the rates of around EGP 11.50 recorded last week, with Al Mal pinning the rate at EGP 10.40. Al Shorouk found the EGP trending lower, saying the rate had fallen to EGP 10.65 per USD 1, the same rate quoted by Al Borsa. Enterprise sold USD at rate of EGP 10.35 yesterday afternoon, but found (1) that few exchange offices are interested in transactions unless they know you personally and you will transact offsite (literally on the side of the road, in our case) and (2) that, in general, exchange offices are reluctant buyers and not sellers, based on our own poll yesterday.

An ‘official’ parallel rate? We jest, but still: The importers division of the Cairo Chamber of Commerce is considering unifying the rate at which its members buy USD from the parallel market. The move aims to take the wind out of the sails of speculators. Al Mal says this is the second collective action by the importers, which also attempted to organise a collective boycott of the parallel market for a week.

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