Egypt's C.Bank sells $551 million in exceptional FX auction

Egypt's central bank (CBE) sold $551 million to banks in an exceptional foreign exchange auction that was hold earlier on Sunday at EGP 7.73 to the dollar “to clear all imports backlog”, a CBE official told Ahram Online.

“Outstanding goods [imports] are zero,” the CBE official, who preferred to be anonymous, said in a text message.

The auction is to cover imports of strategic goods as Egypt has been suffering from a foreign-currency crunch due to political turmoil that has gripped the country since the 2011 uprising.

The foreign currency shortage was exacerbated by plummeting tourism revenues since the deadly crash of a Russian airliner over Sinai last October.

Egypt's pound has been depreciating rapidly on the black market over the past week, piling pressure on the central bank to adjust the official rate of 7.73 pounds to the dollar. It reached 9.50 to the dollar on the black market on Thursday, according to Reuters.

"I think the sale could temporarily hold the decline [of the pound] for a couple of days but the investors and importers are looking for a more sustainable solution because the shortage situation has not been tackled," Hany Genena, head of equities at Beltone Financial, told Reuters.