Banking & Finance Egyptian bond sales fall on likely currency devaluation By Reuters April 5, 2023 Reuters/Amr Abdallah Dalsh Remittances from Egyptians working abroad are down by 26.1% Sales of three-year Egyptian treasury bonds issued on Tuesday plummeted to EGP1.09 million ($35,332) after the government baulked at the high yields demanded by investors concerned the currency is likely to depreciate soon. The central bank received 26 bids worth EGP5.77 billion with a weighted average yield of 24.15 percent at an auction on Monday, but accepted only one of these bids at a yield of 21.7 percent. The accepted yield was unchanged from a similar offering on March 21, when EGP5.06 billion were sold, despite a 200 basis-point increase in the central bank’s overnight deposit rate to 18.75 percent on Thursday. Analysts say investors are also holding back bond purchases on the expectation treasury bond yields will soon begin rising to match the increase in overnight rates. The central bank said it raised rates to help tame soaring inflation, which leapt to 31.9 percent in February. Analysts say pressure has been building on Egypt to devalue its currency after it lost ground on the black market in recent weeks, even though its official price has fallen by half against the dollar over the last year. The official price of the pound has changed little over the last four weeks, at about 30.9 to the dollar, while on the black market it has been trading at between 36 and 37, bankers and dealers say.