The Egyptian Ministry of Finance will offer 91- and 266-day treasury bills worth EGP 5.5 billion for sale at an auction next Sunday. The Ministry plans to raise EGP 1.5 billion from the 91-day T-bills and EGP 4 billion from the 266-day T-bills.
The Ministry failed to sell treasury bills and bonds worth EGP 1.2 billion last week because banks demanded higher returns. The Ministry failed to sell three-year T-bonds worth EGP 500 million. It also sought to raise EGP 1.5 billion from 91-day T-bills, but it raised EGP one billion only and it targeted to sell 182-day T-bills worth EGP 3 billion, but it raised EGP 2.8 billion.
The Ministry sold 149 billion worth of treasury bills and bonds in Q3 of FY 2012/2013 (January-March). The value of yields reached EGP 45.5 billion in January, EGP 53 billion in February and EGP 50.5 billion in March.
The Ministry announced it will offer treasury bills and bonds worth EGP 170 billion during Q4 of FY 2012/2013 (April-June) as follows: EGP 69 billion in April, EGP 46.5 billion in May and EGP 54.5 billion in June.
The average life to maturity of outstanding T-bonds and T-bills increased to 1.4 years at end of December 2012 compared to 1.3 at end of December 2011. Meanwhile, average interest rates on outstanding stock of T-bills and T-bonds increased to 13.46% at end of December 2012 compared to 12.17% at end of December 2011.
As for net domestic budget sector debt, it reached EGP 1131.7 billion (63.7% of GDP) compared to EGP 894.6 billion (58% of GDP) as of end December last year.
The Ministry of Finance sells government debt instruments (treasury bills and bonds) so as to finance the burgeoning budget deficit which widened to EGP 146.5 billion during (July-February) of FY 2012/2013, registering 8.2% of the country’s GDP. The budget deficit is expected to reach EGP 188 billion by the end of the current fiscal year.