Egypt’s central bank sells $509.3M on T-bills Tuesday

CAIRO – 9 June 2020: The Central Bank of Egypt announced the sale of dollar-dominated treasury bills worth $509.3 million for a year.

CBE added in a statement issued, Tuesday, that the average return on dollar-denominated treasury bills amounted to 3.45 percent.

The data showed a decline in international reserves by the end of May 2020 to reach $36.003 billion.

On Friday, the International Monetary Fund announced, Friday reaching a Staff-Level agreement with Egypt on a 12-Month $5.2 Billion Stand-By loan arrangement.

The $5.2 billion loan came after the IMF’s executive board approved $2.77 billion in emergency financing on May 12 to help Egypt grapple with the new coronavirus pandemic that has brought tourism to a standstill and triggered major capital flight.

Despite the decline in figures, the current average of foreign reserves covers about 8 months of Egypt's commodity imports, which is higher than the global average of about three months of commodity imports.

Foreign currencies in Egypt’s foreign reserves include the U.S. dollar, euro, Australian dollar, Japanese yen and Chinese yuan.

The main function of the foreign exchange reserve, including its gold and various international currencies, is to provide commodities, repay the installments on interest rates of external debt, and to cope with economic crises.

On May 12, Egypt received $2.7 billion from the International Monetary Fund, which represents the value of rapid credit financing granted to the Egyptian government.