Feb. 27 (Bloomberg) -- The risk premium investors demand to hold Egypt’s dollar bonds rose for a sixth day to the highest level in eight months after the broadest opposition bloc said it will boycott parliamentary elections in April.
The spread between Egypt’s benchmark dollar-denominated bonds due April 2020 and U.S. Treasuries widened less than one basis point, or 0.01 percentage point, to 582, the highest since June 25, at 3:05 p.m. in Cairo, taking the six-day advance to 48 basis points, data compiled by Bloomberg show.
The benchmark EGX 30 stock index fell 0.6 percent, with 20 shares retreating. The National Salvation Front also rejected President Mohamed Mursi’s call for dialogue because the offer came after he unilaterally set dates for the lower house of parliament polls.
Separately, the central bank sold $38 million at the second dollar auction this week, with local banks receiving 22.86 percent, on average, of what they bid for. The pound, which has weakened to a record this year, was little changed after the sale at 6.7392 a dollar, according to data compiled by Bloomberg.
The currency weakened to 7.4 to the dollar in the unregulated market, state-run Ahram Gate news website reported today, without saying how it obtained the information.
The political divide, underlined by regular street protests which have often erupted into violence, has thwarted efforts to revive the economy, making the government’s bid to negotiate a $4.8 billion International Monetary Fund loan more urgent.
--Editors: Daliah Merzaban, Claudia Maedler