Egypt wants more market stability before Eurobond issue
February 11, 2018 | 1:25 PM
by Reuters
Central Bank of Egypt's headquarters in downtown Cairo, Egypt. - Reuters file picture

Dubai: Egypt is considering plans for a Eurobond issue but wants to see more stability in global financial markets before it goes ahead, Egyptian finance minister Amr El Garhy said on Saturday.

"We want to find the right time and we hope to do this in the next few days," Garhy told Reuters on the sidelines of a financial conference in Dubai, when asked if this week's swings in global markets could affect the planned issue.

"We need to see more stability," he added.

The issue is expected to be around $3 billion to $5 billion in size, he said.

Last Sunday, before last week's massive volatility in global equity and US Treasury markets, Garhy said Egypt expected to issue US dollar-denominated Eurobonds worth $4 billion to $5 billion within days.

Garhy also provided figures suggesting foreign holdings of Egyptian Treasury bills, which soared after the late 2016 devaluation of the Egyptian pound, were continuing to rise.

Those holdings most recently totalled about $20.2 billion, he told reporters. In early December, they were a record $19 billion, according to central bank data.

The figures indicated that falls in T-bill yields over recent weeks had not caused a big exodus of foreign money out of the bills. The yield on 182-day bills fell to 17.358 per cent at an auction this week from 22.278 per cent in mid-July.

Inflation has also been coming down after a spike in the months after the currency devaluation; annual urban consumer price inflation eased to 17.1 per cent in January from 33.0 per cent in July.

"Inflation is on a good path," Garhy said when asked about the trend.

Asked when the government might next cut fuel subsidies in order to strengthen its finances, Garhy declined to discuss a time frame, saying merely that the government was addressing the issue under a long-term reform plan.

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