Egypt - The Central Bank of Egypt (CBE) received 30 bids totalling $1.739bn to cover a local treasury bill (T-bill) auction denominated in US dollars.

The central bank offered this auction on Monday, with a value of $1.5bn, for a one-year maturity period due on November 12, 2025. The proceeds from this auction are aimed at repaying a previous auction, held on November 12, 2023, through which the central bank had withdrawn $1.612bn.

According to data released by the CBE on its website, 21 bids worth $1.5743bn were accepted. The interest rates on these bids ranged between 4.488% and 4.5%, averaging 4.498%. This is compared to the previous similar auction held on June 3rd, where the interest rates ranged from 5.148% to 5.149%.

Some investors had requested a yield reaching 5.25% for their subscription to this auction, but their bids were rejected.

The central bank permits both local banks and foreign institutions to subscribe to these bills, with a minimum subscription amount of $100,000 and its multiples.

Investors subscribe to the dollar-denominated bills using the same method as for local currency bill auctions. Each “primary dealer” bank submits a subscription request to the Central Bank of Egypt, specifying the amount they will subscribe to and the desired interest rate. The CBE then collects all the requests, reviews them, and accepts suitable bids.

The yield on these dollar-denominated bills is determined by several indicators, including global dollar interest rates, alternative investment opportunities available to local and foreign banks and financial institutions, and the country’s credit rating.

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