Central Bank of Egypt surprises markets with interest rate hike

Newsletter

07 Aug 2023

Central Bank of Egypt surprises markets with interest rate hike. The Central Bank of Egypt raised interest rates by 100 basis points to tackle high inflation, contrary to analysts’ expectations of unchanged rates. Rates now stand at 19.25% for deposit, 20.25% for lending, and 19.75% for main operation and disc. rates. Inflation is expected to peak in the second half of 2023. The move led to a rally in USD bonds as it signaled commitment to tackle inflation and potentially improve the IMF loan program. (Enterprise)

SCZone receives approval to launch investment arm: SCZone Istithmar.
The Suez Canal Economic Zone (SCZone) has obtained approval to create SCZone Istithmar, an investment company responsible for managing current and future investments and promoting industrial development through partnerships with private investors. The decision was published in the Official Gazette, and the company's formation has been in progress since last year to attract more foreign direct investment (FDI) into the zone. (Asharq)
Egypt increases Russian wheat purchase amid Moscow's consideration of cheaper grain for "friendly" nations.
Egypt purchased 360,000 metric tons of wheat in its latest tender, paying Russian traders around USD 264 per ton, including freight. Meanwhile, Russia's Prime Minister, Mikhail Mishustin, stated that the country is considering reducing duties on commodity exports, including grain, for "friendly" nations, possibly targeting countries that have imposed sanctions on Russia. (Enterprise)
Egyptian Electricity Holding Company secures 10 billion EGP loan from NBK.
Egyptian Electricity Holding Company borrows EGP 10 billion from National Bank of Kuwait-Egypt to address electricity crisis and carry out maintenance operations for power stations. The crisis is due to a lack of gas and petroleum materials for electricity networks, leading to frequent power cuts across Egypt. (Asharq)
Turkish firms increase investment as Egyptian Trade Minister visits Ankara.
Turkish companies, including Vestel and Zorlu, are considering investments in Egypt's local market, with plans for a 70 million USD white goods factory. Ziraat Bank, Turkey's largest state-owned bank, also expressed interest in potential investments and commercial operations in Egypt. (Enterprise)
Ezz Dekheila Steel approves voluntary delisting and share purchase.
Ezz Dekheila Steel - Alexandria (IRAX) approved the voluntary delisting of its shares from the EGX, and also purchased a 31% stake previously owned by government entities. Ezz Steel, the parent company, extended a 250 million USD guarantee to finance the delisting. After buying back the shares from the government, Ezz Steel will likely own 100% of the company, subject to minority shareholders' decisions to sell their shares. (Arab Finance)
Despite exceeding losses, Qalaa Capital's general assembly approves company continuity.
The Extraordinary General Assembly of Qalaa Capital approved the company's continuity despite losses exceeding half of shareholders' equity. During Q1 2023, the company achieved a net profit of EGP 73.046 million, compared to EGP 468.872 million in Q1 2022. It also recorded standalone net losses of around EGP 927.775 million in Q1 2023, compared to EGP 166.130 million in the same period last year. (Arab Finance)
Suez Canal records 55.1% surge in ship transits during 2022/2023.
The Suez Canal achieves record revenues of 9.4 billion USD in 2022/2023, marking a 55.1% increase in ships transiting the canal. Enhancements to the canal have contributed to its competitiveness and boosted trade movement globally. The canal's success is recognized with prestigious awards, and it continues to play a crucial role in international shipping and trade. (Arab Finance)
Egypt extends gold exploration closing date until November.
Egypt extends gold exploration bid deadline to November, with 8 companies showing interest from China, Turkey, Australia, and local firms. The move aims to allow participants to visit and inspect the exploration sites in the Eastern Desert. Egypt aims to boost investments in the mining sector, targeting one billion dollars by 2030. (Arab Finance)
Ahli United Egypt records unprecedented business results in H1 2023.
Ahli United Bank Egypt achieves exceptional H1 2023 results with a 143% net profit growth, driven by advanced banking services and a diverse product range. Total assets rose by 25.5%, and the bank aims to support development plans and expand its offerings in the Egyptian market. (Arab Finance)