Egypt pound hits 10-month low as black market rate weakens

The Egyptian pound hit a 10-month low on Monday as the central bank let the local currency weaken further, while a persistent dollar shortage keeps prices on the black market high above official rates.
The bank said it sold $40 million at a cut-off price of 7.005 pounds, weaker than the rate of 6.9976 pounds at its last sale on Wednesday and the seventh drop in a row. The closely-linked interbank rate rose to 7.0149 pounds, its weakest since July.
The rates banks are allowed to trade dollars at are determined by the results of the central bank sales, giving the bank effective control over official exchange rates.
Three years of political turmoil since the 2011 uprising against autocrat Hosni Mubarak have unnerved tourists and foreign investors, leaving Egypt's economy suffering from a persistent dollar shortage.
Tensions have ratcheted up further as presidential elections scheduled for May 26-27 draw nearer.
The central bank - propped up by dollar inflows from Gulf allies - has in recent weeks allowed the pound to weaken. But it still trades markedly weaker on the black market, where it stood at 7.50 per dollar on Monday compared with 7.47 a day earlier.
Egypt's foreign reserves rose to $17.414 billion in March from $17.307 billion in February. They stood at around $36 billion before Mubarak was toppled.