Egypt Sees About $1 Billion Foreign Inflows Since Rate Boost

(Bloomberg) -- Egypt received about $1 billion in foreign inflows since the central bank raised interest rates by 200 basis points last week to curb inflation.

The country had $448 million in “foreign investment inflows” on Thursday and $400 million on Sunday, state-run news agency MENA reported, citing Central Bank Governor Tarek Amer. He didn’t specify the form for the investments, but Egypt holds weekly Treasury bill sales on those days.

“These investment figures are considered historic,” Amer said, according to MENA. They reflect the “success” of the central bank’s monetary policy, which takes into consideration conditions of local and international markets, he said.

Foreign currency inflows into Egypt’s debt and equity markets have been steadily growing since the central bank removed restrictions on the currency and raised interest rates in November before securing a $12 billion loan from the International Monetary Fund. Foreign holdings of Egyptian T-Bills were about 120 billion pounds ($6.63 billion) as of May 23, according to the Finance Ministry’s public debt chief, Samy Khallaf.

On Thursday, the Ministry of Finance said it sold more T-Bills than it targeted to accommodate an uptick in demand from foreign investors. In Sunday’s sale, the average yield on 9-month notes rose 77 basis points to 20.48 percent, and the average yield on 3-month notes rose by 1 percentage point to 20.52 percent.

To contact the reporter on this story: Ahmed Feteha in Cairo at afeteha@bloomberg.net.

To contact the editors responsible for this story: Alaa Shahine at asalha@bloomberg.net, Amy Teibel, Dana El Baltaji