Local and foreign financial institutions offered to invest $1.054bn in the USD-denominated treasury bills auction issued by the Central Bank of Egypt (CBE) on Monday.
On behalf of the Ministry of Finance, CBE had submitted USD T-Bills worth $850m.
According to data obtained by Daily News Egypt, CBE accepted $944.5m of the total bids.
The highest rate of interest on investment in this auction reached 3.35%, while the lowest was at $3.32%, averaging 3.346%.
The proceeds of this tender are to cover the value of a previous tender worth $888.8m put forward on 10 January 2017.
The CBE allows local banks and foreign institutions to subscribe for the US dollar with a minimum of $100,000 and its multiples.
The interest rate on the US dollar T-bills is decided in accordance with a number of factors, most prominently the volume of the US dollar’s liquidity in the market, the alternative investment opportunities available for the local and foreign financial institutions that invest in these bills, and the country’s credit rating.
Banks operating in the local market rely on these bills to invest their liquidity in euros safely with the government, with an appropriate yield, in light of the lack of other investments for such liquidity. Exceptions include rare syndicated loans, or investment in global capital markets, with a low yield and many risks.