CBE Sells US$1.013 Bln of Dollar- Denominated T-Bills, Exceeding Target

Central Bank of Egypt (CBE) sold US$1.013 billion of dollar – treasury bills today, exceeding its US$750 million target on demand. The nation’s 2020 dollar bond declined for the third day.

The average yield on the one-year notes fell to 3.706 % from 3.844 % at the last sale of similar-maturity notes in February, according to an e-mailed statement from the central bank.

CBE received bids for the securities that surpassed the amount offered by 2.5 times, it said.

The Ministry of Finance, on whose behalf the central bank holds government security auctions, accepted more bids than it had planned “due to increased appetite by local financial institutions,” according to the regulator’s statement.

Egypt expects to sign a US$3.2 billion loan agreement with the IMF around the beginning of June, said Finance Minister Momtaz El-Saeed. The first part of the loan could be disbursed around July 1. El-Saeed said in April the signing would take place that month after the government obtained parliament’s approval.

One-year local-currency bills yielded an average 15.85 percent at their last sale on May 10. Rising yields on pound- denominated debt have forced the country to fall 25 percent short of meeting its 36.5 billion-pound ($6 billion) fundraising goal at sales of treasury bills and bonds this month.

The yield on the 5.75 percent dollar bonds due 2020 rose three basis points, or 0.03 percentage point, to 6.95 percent at 1:52 p.m. in Cairo. That’s the highest level on a closing basis in more than a month. The Egyptian pound weakened 0.1 percent to 6.037 a dollar, according to Bloomberg.