#Kuwait and Egypt See Over $29 Billion Investor Demand for Dollar Bond Offers - Bloomberg

Kuwait and Egypt See Over $29 Billion Investor Demand for Dollar Bond Offers - Bloomberg

A rush of bond sales in Middle East and North Africa picked up speed on Tuesday, with Kuwait and Egypt taking advantage of investor appetite for higher dollar yields before US interest rates fall.

Kuwait is tapping the international bond market for the first time in eight years, after a long-delayed local law was approved and opened the way for a return to global debt markets. Egypt, whose high interest rates make it popular with many investors, is seeking to diversify its financing sources as it claws its way back from the worst economic crisis in a generation.

“The array of issuances comes as countries make use of a good window to issue following the resumption of the easing cycle in the US and ahead of the end-year close,” said Mohamed Abu Basha, head of macro analysis at Cairo-based investment bank EFG Hermes.

Aggregate demand for Kuwait’s three, five and 10-year notes is close to $28 billion. Price guidance points to as low as 40 basis points over US Treasuries for the shortest tranche and as high as 60 basis points for the longest.

Egypt is likely to issue $1.5 billion worth of bonds, after receiving offers of over $8.9 billion for its dollar-denominated Islamic bonds, with maturities of long three and seven years. Price guidance stands at 6.375% and around 8%, respectively.

All the information is from a person familiar with the matter, who asked not to be identified. Final terms of the deals, including the size and yield, are expected to be disclosed later on Tuesday.

Separately, Bahrain has mandated banks for dollar-denominated bonds with maturities of long eight and twelve years. Algeria is planning to raise 297 billion dinars ($2.3 billion) from the sale of Islamic bonds, a rare issuance of debt by the OPEC member, although it will be offered only to Algerian investors, Asharq TV reported.

Saudi Arabia has already raised nearly $20 billion in dollar- and euro-denominated debt this year, making it the biggest issuer among emerging markets along with Mexico, according to data compiled by Bloomberg.

The increase in bond sales from the Middle East comes with lower oil and gas prices widening many governments’ fiscal deficits.

Bahrain’s bonds have given investors total returns of more than 10% this year. While investors are concerned about the country’s high funding needs, they are keen to benefit from its high yields and a compression in risk spreads across most emerging markets.

Egypt’s existing Islamic bonds have lagged this year even as their emerging-market peers gain because of a weaker dollar. The country’s February 2026 sukuk have dropped 1.8%, but have given investors a total return of 6.2% due to hefty coupon payments.

Conventional dollar bonds have fared better, giving investors a 17% total return this year.