CAIRO: The median overnight interbank rate on the Egyptian pound jumped to 9.8 percent on Tuesday from 9.443 percent on Monday, with central bank auctions of certificates of deposit draining market liquidity, traders said.
The market is short today after banks put their funds into the one-week and 128-day certificates of deposit auctions, so there s not much liquidity, one trader said.
The central bank was auctioning 7-day and 128-day certificates of deposits for LE 14.5 billion ($2.5 billion) on Tuesday.
Two-day and seven day certificates of deposit worth LE 11.7 billion were also maturing on Tuesday as were treasury bills worth LE 5 billion.
Tuesday marks the start of a new two-week period for calculating bank reserves, and rates tend to rise as banks have already squared their positions and wish to participate in any new financial instrument auctions offered by the central bank.
Two out of 10 banks contacted by Reuters reported overnight deals at rates between 9.8 and 9.975 percent, compared to Monday s range of 8.95 and 9.75 percent.
Five banks reported dealing one-week money at a range of 9.7 and 10.0625 percent, while on Monday only one bank dealt in one-week money at 9.7 percent.
By 1 pm local time (1100 GMT) the pound had strengthened against the dollar to 5.7117 pounds to the dollar, from Monday s closing weighted average of 5.7121 pounds.
