CAIRO - Foreigners continued their rush to buy Egyptian treasury bills on Thursday to take advantage of high yields and a more stable outlook following Egypt's devaluation of its currency and signing of an $8 billion agreement with the IMF, bankers said.

Foreign investors resumed purchases of T-bills last week after a long absence triggered in part by the outbreak of the Ukraine war two years ago.

Banks and investors submitted bids for a total of 408.1 billion Egyptian pounds ($8.55 billion) of one-year T-bills and 130.6 billion pounds of six-month T-bills in the central bank auction.

Of those, 217.9 billion pounds of the 364-day bills and 46.8 billion of the 182-day bills were accepted, according to data posted on the central bank website. The central bank data does not differentiate between foreign and domestic buyers.

"There was huge interest from local and foreign investors," one Egyptian banker said. "Egypt turned overnight from a black cat to Snow White."

The average yield for the one-year bills declined to 30.14% from last week's 32.30% and that for the six-month bills to 29.19% from 31.84%.

The bids for one-year bills were more than one and a half times those submitted last week, the day after the currency devaluation.

"A big size was accepted and coverage was massive in one-year," said a second banker.

The central bank allowed the currency to fall to more than 50 pounds to the dollar as part of an agreement with the International Monetary Fund signed on March 6. It had left the rate fixed for the previous 12 months at just under 31 pounds.

The currency has since gradually strengthened to 47.75 pounds to the dollar.

Central bank governor Hassan Abdalla said on Thursday that the demand for dollars had begun to decline due to supply made available by the bank, according to a cabinet statement.

($1 = 47.7500 Egyptian pounds)

(Reporting by Patrick Werr; Editing by Hugh Lawson)