CAIRO, March 14 The Egyptian pound traded at its
weakest rate in roughly one month on Tuesday as dollar demand
for imports ahead of the Ramadan holy month continued to put
pressure on bank liquidity.
Banks were selling dollars for between 17.80 and 18.05
pounds, the high end of which marks the weakest rate since
Feb. 12, according to Reuters data.
Ramadan, Islam's holy month during which believers fast
during daylight hours and eat after dusk and before dawn, will
start in May this year. Consumption usually rises during the
month and many Egyptian families stock up on various food items
and other goods which are purchased from abroad.
Bankers said the holiday importing has in recent weeks put
pressure on dollar liquidity at banks, which have raised the
price for dollars by about 0.5 pounds in interbank trading in
just the last week.
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 stem a black market which diverted hard currency
liquidity away from the banking system.
The float more than halved the pound's value to nearly 20
pounds to the dollar by December. It has since rallied, however,
dipping below 16 per dollar in February on the back of lower
dollar demand for imports before beginning its current slide.
(Reporting by Asma Alsharif and Eric Knecht; Editing by Dominic