Egypt's central bank has told commercial banks it will offer 400 million euros in one-year euro-denominated treasury bills at an auction on Aug. 28, a banker said on Thursday. It will be the first time the central bank has sold euro T-bills. In November it introduced T bills denominated in U.S. dollars, and has sold $5.83 billion of the bills in six auctions so far. The government has turned mainly to the local money market to finance its budget deficit since Egypt's popular uprising in early 2011 chased away most foreign investors, and the ability of local banks to lend the government Egyptian pounds has been stretched to its limit. Yields on domestic Egyptian pound T-bills have surged since the uprising, which unseated Hosni Mubarak. The average yield on 182-day T-bills rose to more than 15.5 percent last month from under 10 percent in December 2010. The central bank last sold $526 million in dollar T-bills on June 19, when the weighted average yield was 3.715 percent. The euro T-bills, which will mature on Aug. 27, 2013, are being offered to local banks and foreign financial institutions. The government's budget deficit was equivalent to 8.2 percent of gross domestic product in the financial year that ended on June 30, and the finance ministry expects it to rise to 12.5 percent in the current financial year. Reuters
