Emerging markets (minus Egypt) thought they had beaten inflation. The oil price rally might have something to say about that: The ongoing rally in the oil markets is threatening to force the recent disinflationary trend in emerging markets into reverse, potentially delaying plans for interest rate cuts, writes Bloomberg. Oil prices have surged 30% over the past three months to reach 10-month highs on the back of supply cuts by Saudi Arabia and Russia, a trend that is starting to put pressure on bonds and currencies of emerging-market oil importers.

Remember: It’s not just oil prices putting pressure on EM. The recent hawkish tone from the US Federal Reserve has helped drive the USD to six-month highs, a move that is also putting pressure on emerging economies’ sovereign debt and currencies.

EGX30

20,213

+0.7% (YTD: +38.5%)

USD (CBE)

Buy 30.83

Sell 30.96

USD at CIB

Buy 30.85

Sell 30.95

Interest rates CBE

19.25% deposit

20.25% lending

Tadawul

10,949

-1.0% (YTD: +4.5%)

ADX

9,849

0.0% (YTD: -3.5%)

DFM

4,169

-0.3% (YTD: +25.0%)

S&P 500

4,320

-0.2% (YTD: +12.5)

FTSE 100

7,684

+0.1% (YTD: +3.1%)

Euro Stoxx 50

4,207

-0.1% (YTD: +10.9%)

Brent crude

USD 93.27

0.0%

Natural gas (Nymex)

USD 2.64

+1.0%

Gold

USD 1,945.60

+0.3%

BTC

USD 26,489

-0.4% (YTD: +60.3%)

THE CLOSING BELL-

The EGX30 rose 0.7% at yesterday’s close on turnover of EGP 2.1 bn (0.1% above the 90-day average). Local investors were net sellers. The index is up 38.5% YTD.

In the green: Abu Qir Fertilizers (+7.5%), Mopco (+4.7%) and Talaat Moustafa Group (+2.3%).

In the red: GB Corp (-4.9%), EFG Holding (-2.5%) and Madinet Masr (-1.9%).

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