(MENAFN) The Central Bank of Egypt announced its plans to issue one-year dollar-denominated treasury bills amounting to USD980 million on April 29, with settlement scheduled for April 30. This move comes against the backdrop of heightened foreign investor activity in Egyptian treasury bills, with billions of dollars flowing into the market since Cairo's announcement of an USD8 billion financial support agreement with the International Monetary Fund (IMF) on March 6.
In a statement, the Central Bank outlined its intention to leverage this surge in investor interest by issuing dollar-denominated treasury bills, signaling confidence in the stability of Egypt's economic landscape. The decision to tap into international markets for financing underscores the government's commitment to bolstering its fiscal position and capitalizing on favorable investor sentiment following recent economic developments.
The announcement of the financial support agreement with the IMF coincided with a significant investment deal worth USD35 billion with the United Arab Emirates (UAE), amplifying optimism surrounding Egypt's economic prospects. This positive momentum was further bolstered by a decisive move by the Central Bank to raise overnight deposit and lending rates by 600 basis points, providing much-needed respite to the country's strained public finances.
Foreign investor confidence in Egyptian treasury bills had waned towards the end of 2021 due to apprehensions regarding currency overvaluation and concerns about the government's ability to meet its financial obligations. However, the announcement of the IMF agreement, coupled with other financial support measures, catalyzed a notable shift in investor sentiment.
Bankers and analysts attribute the renewed interest in Egyptian treasury bills to the reassurance provided by the IMF agreement and the influx of financial support, which have instilled greater confidence in the country's economic trajectory. As Egypt continues to navigate through economic challenges, initiatives such as the issuance of dollar-denominated treasury bills serve as strategic measures to capitalize on investor confidence and foster sustained economic growth.
MENAFN29042024000045015682ID1108150348
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.