By John Galt
July 3, 2011
As the coals simmer and the fireworks explode, the rest of the world marches on resulting in tonight’s candidate for:
Tonight, courtesy or Reuters, we venture out to the land of the Pharaohs and pyramids where the makeshift military government decided to hold a Treasury auction today and the results were horrific:
The bank sold 1 billion Egyptian pounds of 91-day bills at an average yield of 12.112 percent, up from 12.095 percent at last week’s auction. It had asked for bills worth 2 billion pounds.
It also sold 1.5 billion pounds of 273-day T-bills after having offered 3.5 billion pounds. The average yield dipped to 12.887 percent from 12.944 percent at the last issue on June 21.
(from Reuters: Egypt sells fewer T-bills than it offered )
In other words of 5.5 billion Egyptian pounds offered they only sold 45% of the offering which should give everyone some insight as to how the faith in the “Arab Spring” and suspicions of the Islamist Summer are starting to impact the financial markets. I would not get too concerned at this moment as Saudi Arabia might continue to fund their poor sister to the West so as to prevent instability from seeping over into their nation. This situation will need to be monitored in the MENA region however as a possible indication of the coming rejection of emerging market debt, especially in regions prone to war, terrorism, and uprisings.