CAIRO: The Egyptian pound reached its lowest exchange against the dollar in more than six years on Wednesday, as investors were prompted to sell the currency due to political uncertainty, reporter Reuters. The pound regained some ground later in the day after investors bought EGP to invest in a stock market rally. The pound traded at 5.9640 to the dollar after hitting 5.9765 earlier in the day, the lowest since January 2005, down 0.29 percent from Tuesday's close. “The pound has weakened mainly because foreigners are exiting a market hit by political instability,” Reuters quoted a Cairo-based trader as saying. “Egypt is getting downgraded, and for foreign investors, this is negative.” Investment bank EFG-Hermes had said it maintained its outlook for a continuous weakening of the pound driven by a widening current account deficit and large capital outflows. It forecast the pound to weaken to 6.3 by the end of 2011. But bankers said a four-day stock market rally renewed buying appetite into the pound later on Wednesday. Egypt's benchmark index .EGX30 closed 1.3 percent higher. The pound has lost 2.5 percent of its value against the dollar since mass protests erupted on January 25. BM
