Egypt Meets Bond-Sale Target as Yields Rise, Aid Trickles in

Egypt sold all 5 billion Egyptian pounds ($823 million) of treasury bills if offered today at higher yields as international aid starts to arrive. The dollar bonds were little changed.

The Arab country raised 1 billion pounds of three-month notes and 4 billion pounds of nine-month notes at the auction, according to central bank data on Bloomberg. The nine-month bills yield climbed 12 basis points, or 0.12 percentage point, to 15.84 percent from the Aug. 5 sale of similar-maturity notes. The average yield on the three-month notes rose five basis points to 14.24 percent from the previous sale.

Egypt is due to sign a $200 million loan agreement with the World Bank this week, Prime Minister Hisham Qandil said Aug. 8. The government also expects to receive $500 million of the $2 billion that Qatar agreed to deposit at the central bank before the Islamic Eid holiday, Finance Minister Momtaz el-Saieed said Aug. 12. The sale of nine-month bills was scrapped that day, the first cancellation of a debt offering since May.

The International Monetary Fund’s Managing Director Christine Lagarde will visit Egypt next week, Qandil said yesterday. Egypt will ask the IMF to raise a requested loan to $4.8 billion from $3.2 billion, El-Saieed told reporters in Cairo today. Loan talks are set to resume at the end of the month after being stalled several times in the past year because of changes in government.

The yield on the 5.75 percent dollar bonds due April 2020 were little changed at 6.2 percent at 2:45 p.m. in Cairo, according to prices compiled by Bloomberg. The pound, subject to a managed float, weakened 0.1 percent to 6.0780 a dollar.

Banks will be closed Aug. 19 and Aug. 20 for Eid, marking the end of the holy month of Ramadan.

To contact the reporter on this story: Ahmed A. Namatalla in Cairo at anamatalla@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.