The Central Bank of Egypt (CBE) is set to offer a one-year Treasury bill (T-bill) auction denominated in U.S. dollars, with a value of $950 million and a maturity date of April 28, 2026.
Proceeds from this auction will be utilized to cover the maturity of a previous dollar-denominated tender launched on April 30, 2024, through which CBE withdrew $997.6 million.
In a prior auction held on 4 February 2025, CBE offered $1 billion in T-bills for 364 days, maturing on February 3, 2026. The auction attracted 27 bids totaling $1.241 billion, with 17 bids accepted amounting to $1.061 billion at an interest rate of 4.25 percent. While some investors sought yields as high as 5.3 percent, those bids were ultimately rejected.
CBE allows both local banks and foreign financial institutions to subscribe to these dollar-denominated T-bills, with a minimum subscription amount set at $100,000, and in multiples thereafter. Investors apply for the T-bills following the same procedure used for local currency issuances: each primary dealer bank submits its subscription request to CBE, detailing the amount and the interest rate being offered. CBE then reviews the bids and selects the most suitable offers.
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Factors influencing yield on dollar-denominated bills
The yield on these dollar-denominated bills is shaped by several key factors, including prevailing U.S. dollar interest rates in global markets, alternative investment opportunities available to local and international financial institutions, and Egypt’s credit rating.
In June 2024, CBE received 19 offers totaling $605.6 million for its dollar-denominated local treasury bills from both local and international investors. The central bank issued $500 million in dollar-denominated local treasury bills with a maturity rate of one year, due in June 2025. Proceeds from this auction will be used to settle a previous auction held on June 6, 2023, during which the central bank raised $554.1 million. Of the 19 offers received, only 17 were accepted, totaling $500.6 million. Additionally, the interest rate for these bids was set between 5.148 percent and 5.149 percent, mirroring the rate from its last bid on April 29, 2023.
