Central Bank of Egypt Reports Record Treasury Bill Issuance Amid Declining Yields
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The Central Bank of Egypt recently disclosed the results of its latest treasury bills auction, revealing a significant issuance of debt instruments worth 104.7 billion Egyptian pounds for terms of 182 and 364 days. This move comes as part of the government’s broader strategy to manage liquidity and stabilize the economy amidst fluctuating interest rates and growing foreign investor interest in long-term debt.
Treasury Bill Auction Highlights
During the auction held last Thursday, the Central Bank accepted bids totaling 34.7% of the 300 billion pounds offered, marking a notable shift in the country’s debt management approach. The yield on one-year treasury bills declined by 0.5%, reflecting increased demand from foreign investors. This trend has been consistent as March, with the latest auction seeing the largest accepted bids at 68.522 billion pounds and an average return of 25.43%.
Similarly, the yield on 182-day treasury bills dropped by 0.27%, with the Ministry of Finance accepting 36.206 billion pounds of these instruments. This decline in yields underscores the growing appetite for Egyptian debt, especially among international investors seeking higher returns in emerging markets.
Key Data from the Auction
| Term | Amount accepted (EGP) | Yield Decline | average Return |
|—————–|—————————|——————-|——————–|
| 182 Days | 36.206 billion | 0.27% | 25.43% |
| 364 Days | 68.522 billion | 0.5% | 25.43% |
| Total | 104.7 billion | - | – |
Broader Debt Issuance Trends
The Central Bank’s latest auction is part of a larger trend in Egypt’s debt issuance strategy. Between early December 2024 and mid-January, the government issued local currency debt instruments worth 1.028 trillion pounds. this includes treasury bonds with fixed coupon interest valued at 54.5 billion pounds and variable-return bonds linked to corridor prices worth 13.8 billion pounds.
As December 2024, the Ministry of Finance has borrowed approximately 960 billion pounds through treasury bills, representing 28% of the 3.425 trillion pounds offered. This aggressive borrowing strategy aligns with the government’s efforts to finance its fiscal deficit and support economic growth.
Declining Yields Across Maturities
the yield on 91-day treasury bills decreased by 4.38%, with the ministry borrowing 257 billion pounds at an average return of 26.82%. similarly, the yield on 182-day bills fell by 4%, making it the best-selling term with 346 billion pounds issued. The 273-day bills also saw a decline of 1.86%, with 184 billion pounds sold at an average return of 26.68%.
future Debt issuance Plans
Looking ahead, the Ministry of finance has announced plans to issue local currency debt instruments worth 1.983 trillion pounds during the third quarter of the fiscal year 2024-2025 (January-March). This represents a 17% annual growth in debt issuance, reflecting the government’s commitment to maintaining liquidity and attracting foreign investment.
Why This Matters
The declining yields on Egyptian treasury bills and bonds signal growing confidence in the country’s economic stability. As foreign investors increasingly turn to Egypt’s debt market, the government is well-positioned to secure the funding needed for its ambitious development projects.
For more insights into Egypt’s financial landscape, explore the Central Bank of Egypt’s official website or read about the best savings certificates in Egyptian banks for 2025.—
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Central Bank of Egypt Reports Record Treasury Bill Issuance Amid Declining Yields
The Central Bank of Egypt recently disclosed the results of its latest treasury bills auction, revealing a significant issuance of debt instruments worth 104.7 billion Egyptian pounds for terms of 182 and 364 days. This move comes as part of the government’s broader strategy to manage liquidity and stabilize the economy amidst fluctuating interest rates and growing foreign investor interest in long-term debt. To delve deeper into this development, we spoke with Dr. Ahmed El-Sayed, a renowned economist and expert on Egypt’s financial markets.
understanding the treasury Bill Auction
Senior Editor: Dr. El-Sayed, thank you for joining us. The Central Bank’s recent auction saw a significant issuance of treasury bills. Can you explain what this means for Egypt’s economy?
Dr. ahmed El-Sayed: Thank you for having me. The issuance of 104.7 billion Egyptian pounds in treasury bills is a clear indication of the government’s strategy to manage liquidity and attract foreign investment. Treasury bills are short-term debt instruments, and their issuance helps the government raise funds to cover fiscal deficits. The fact that the Central Bank accepted bids totaling 34.7% of the 300 billion pounds offered shows a strong demand, particularly from foreign investors. This is a positive sign for egypt’s economic stability.
Declining Yields and Foreign Investor Interest
Senior Editor: The yields on these treasury bills have declined. What does this tell us about investor confidence?
Dr. Ahmed El-Sayed: The decline in yields, particularly on the one-year treasury bills by 0.5% and on the 182-day bills by 0.27%, reflects increased demand from foreign investors. When yields drop, it means that investors are willing to except lower returns, which is frequently enough a sign of growing confidence in the country’s economic stability. This trend has been consistent as March,and it underscores the growing appetite for Egyptian debt,especially among international investors seeking higher returns in emerging markets.
Broader Debt issuance Trends
Senior Editor: Beyond this auction, what broader trends are we seeing in Egypt’s debt issuance strategy?
Dr. Ahmed El-Sayed: The Central Bank’s latest auction is part of a larger trend. Between early December 2024 and mid-January,the government issued local currency debt instruments worth 1.028 trillion pounds. This includes treasury bonds with fixed coupon interest valued at 54.5 billion pounds and variable-return bonds linked to corridor prices worth 13.8 billion pounds. This aggressive borrowing strategy aligns with the government’s efforts to finance its fiscal deficit and support economic growth.
Future Debt issuance Plans
Senior Editor: Looking ahead, what are the government’s plans for future debt issuance?
Dr. Ahmed El-Sayed: The Ministry of Finance has announced plans to issue local currency debt instruments worth 1.983 trillion pounds during the third quarter of the fiscal year 2024-2025 (January-March). This represents a 17% annual growth in debt issuance, reflecting the government’s commitment to maintaining liquidity and attracting foreign investment. This is a crucial step in ensuring that Egypt can continue to fund its ambitious development projects.
Why This Matters
Senior Editor: why is this significant for Egypt’s economy?
Dr. Ahmed El-Sayed: The declining yields on Egyptian treasury bills and bonds signal growing confidence in the country’s economic stability. As foreign investors increasingly turn to Egypt’s debt market, the government is well-positioned to secure the funding needed for its ambitious development projects. this is a positive development for Egypt’s economic outlook and underscores the importance of maintaining a stable and attractive investment environment.
Stay informed about the latest developments in Egypt’s financial markets by subscribing to our newsletter or following us on social media.
