The market is gearing up for the reopening of banks tomorrow, Sunday, after their weekly closure, to gauge the impact of the Central Bank of Egypt’s (CBE) recent 1% interest rate cut on savings instruments and loan products.
The Monetary Policy Committee announced a reduction in the overnight deposit rate to 24%, the overnight lending rate to 25%, and both the CBE’s main operation rate and the discount and credit rate to 24.50%. These benchmark rates are key indicators shaping short-term interest rate movements in the Egyptian pound market.
In immediate response, yields on floating-rate certificates and certain loan products linked to the CBE’s benchmark rates—known as the “corridor”—dropped automatically by 1%. Among the most affected are popular floating-rate savings certificates such as the National Bank of Egypt’s “Platinum” and Banque Misr’s “Qimma”, alongside a broad range of floating-rate loans.
Market participants are also closely monitoring the broader implications of the rate cut on yields for Treasury bills and bonds scheduled for issuance this week. This includes evaluating the potential impact on foreign investor demand for Egyptian government debt.
Tomorrow, the Ministry of Finance plans to offer two Treasury bill tenders totaling EGP 75bn: a 91-day tender worth EGP 30bn and a 273-day tender worth EGP 45bn. These are part of a larger issuance program in May, which includes 31 tenders amounting to EGP 682bn—comprising 16 Treasury bill tenders totaling EGP 600bn and 15 bond tenders valued at EGP 82bn.
