Egypt to auction $1 billion dollar-denominated treasury bills

Money supply (M2) grew by 19.92 percent year-on-year in December 2023
Egypt to auction $1 billion dollar-denominated treasury bills
CBE raised on Thursday interest rates

According to the Central Bank of Egypt (CBE), Egypt is planning to auction one-year maturity dollar-denominated treasury bills (T-bills) worth $1 billion on February 5.

In addition, the CBE has confirmed that the money supply (M2) grew by 19.92 percent year-on-year in December. The total money supply reached EGP8.877 trillion (or $287 billion), up from EGP7.402 trillion a year earlier.

Read more: CBE raises interest rates by 200 basis points: Is a currency devaluation on the horizon?

In a separate development, Egypt’s exchange indexes witnessed an increase towards the end of Thursday’s trading session, marking the conclusion of the week, after a notable decline experienced on Wednesday. During that time, market participants were eagerly anticipating the decisions of the CBEs Monetary Policy Committee (MPC) concerning interest rates.

Recovery from previous losses

The market capitalization of listed companies on the stock exchange recovered approximately EGP43 billion (around $1.4 billion) from Wednesday’s losses, closing at EGP2.011 trillion ($65 billion) after a total trading volume of EGP12.5 billion ($404 million), which included EGP7.3 billion ($236 million) in bond market transactions and treasury bills.

Uncertainties in inflation projections

On Friday, February 2, 2024, the exchange rate of the dollar in Egypt remained unchanged, in response to CBE’s decision to raise the interest rate.

The central bank raised the interest rate to 21.25 percent for deposits and 22.25 percent for lending, citing uncertainties in inflation projections, particularly related to global commodity prices due to ongoing geopolitical tensions and disruptions in navigation traffic in the Red Sea.

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