International investors have rushed into Egypt’s debt after the most populous Arab nation secured a $55bn bailout and Gulf investment package to reboot its troubled economy and prevent it succumbing to fallout from the war in Gaza.
Demand for short-term bonds issued by Egypt at double-digit interest rates has surged since last month’s financial rescue, and a large devaluation in Egypt’s pound, staved off a debt crisis that only weeks ago loomed over the country.
Investors bid $21bn for $2.4bn in one-year Treasury bills on offer from the Egyptian government over the past month — it sold $8.5bn — in a return of the “hot money” flows that had shunned the country as too risky only a few weeks ago. Yield on the bills fell from 32 per cent to 26 per cent.