To cut or not to cut: Everyone has something to say about how central bankers are tackling inflation

Policymakers want rate cuts, and they want them now. Analysts and economists are not happy with central bankers’ wait-and-see approach, pilling pressure on central banks to start moving forward with rate cuts before economies start to suffer, the Financial Times wrote. While central bankers remain worried about easing monetary policy prematurely, policymakers believe that waiting longer than necessary could “harm weakening economies or hobble heavily indebted governments.”

Why the hold up? Central banks are scared of underestimating inflation and declaring victory in their fight against inflation too soon. “The question of a cut may arise when the time comes during 2024, but not now: when a remedy is effective, you have to be patient enough on its duration,” the Bank of France governor said.

Calls for rate cuts will likely fall on deaf ears, with the OECD expecting central banks to keep rates higher than expected in 2024 due to continuing cost pressures for businesses and rising food and energy prices for consumers.

Crypto bros believe rate cuts are coming. BTC rose above USD 40k for the first time since May 2022, reaping the benefits of a market-wide rally triggered by investor beliefs that the Federal Reserve has reached the end of its aggressive tightening policy, Bloomberg reported.

CORRECTION- We incorrectly said that Dubai Taxi’s IPO is the largest IPO that Dubai has ever had. We have since amended the story on our website.

THE CLOSING BELL-

The EGX30 fell 0.7% at yesterday’s close on turnover of EGP 3.4 bn (14.2% above the 90-day average). Regional investors were net sellers. The index is up 68.3% YTD.

In the green: GB Corp (+7.8%), Madinet Masr (+6.5%) and Qalaa Holdings (+6.1%).

In the red: Mopco (-3.5%), Ezz Steel (-3.2%) and Edita (-3.2%).