Egypt auctions EGP 40 bln T-bills on Tuesday

The first issue, worth EGP 22.5 billion, has a 91-day tenor that matures on 3 October. The second issue, worth 15.7 billion, has a 273-day tenor that matures on 2 April 2024.

The CBE typically issues T-bills on behalf of the Ministry of Finance to fund the budget deficit.

On 26 June, the CBE auctioned EGP 43 billion in T-bills in two issues, of which around EGP 2.2 billion in bids have been accepted at an average yield of 23.5 percent.

The slashed coverage of Egypt's latest T-bills is alarming as the country faces a great shortage in foreign currency, especially the US dollar. In June, President Abdel-Fattah El-Sisi announced that Egypt needs up to $90 billion in foreign liquidity to overcome the current crisis.

Egypt’s foreign debt jumped to $162.9 billion during the first half of the fiscal year 2022/2023, compared to $155.7 billion by the end of the previous fiscal year, according to CBE’s data.

Egypt is currently engaged in a four-year loan programme with the International Monetary Fund (IMF), under which Egypt is committed to applying a free regime for both exchange rates and interest rates.

Egypt received the first tranche of the loan worth $347 million in December 2022 upon securing the approval for the loan deal.