Good morning, friends, and welcome to hump day. The torrent of news shows no signs of abating, but a flurry of M&A and startup news has added welcome spice to a cycle that has been otherwise dominated by talk of the Three Horsemen of war, inflation, and devaluation.

It’s not that the Three Horsemen are absent from the headlines:

FX WATCH-

More banks have stopped the use of EGP debit cards outside the country, with the National Bank of Egypt, Arab Bank, Banque Misr, Emirates NBD, and National Bank of Kuwait in Egypt having followed yesterday in the footsteps of other major lenders including AAIB, CIB and Arab International Bank. The banks are acting in concert with the CBE, according to a report by Asharq Business citing what it says are unnamed bank CEOs. A senior banker with first hand knowledge of the situation confirmed the report when we reached out yesterday. Look for more banks to follow suit this week. Bloomberg has also picked up the story.

MEANWHILE- HSBC doesn’t see any movement on devaluation until next year: The bank expects authorities to wait until 1Q 2024 before pulling the trigger on the widely anticipated currency devaluation, according to a report picked up by Al Borsa. Most observers don’t expect the government to devalue the currency before the presidential election in December; some see the decision to bring the poll forward from 2024 as a move aimed at accelerating the reform process.

The damage? HSBC is forecasting the EGP to fall another 25% against the greenback to 37.50 by the end of the quarter and 40.00 by the close of 2Q. The fall is going to require the central bank to hike interest rates by another 350 bps, taking its benchmark rate to 22.75% — its highest level since the early 1990s.

Why the wait? Authorities will want to give themselves as much time as possible to build up a war chest of foreign currency via finalizing asset sales ahead of the devaluation, the bank said.

We’re still waiting to see when the IMF will kick into that war chest: The Fund has delayed the first two reviews of the USD 3 bn program due to a lack of movement on the currency reform front, and last week spelled out in stark terms that Egypt is going to need to weaken lest we keep “bleeding reserves.”

INFLATION WATCH-

Inflation figures due out today — the expectation is that it reached another all-time high in September. That’s according to a Reuters poll of analysts, which forecasts urban consumer prices to have inched up to 37.6% y-o-y last month from 37.4% in August.

Remember: Inflation has soared to record highs for the past three months on the back of the FX crunch, devaluation, and fuel price hikes.

ON THAT NOTE- Businesses, gov’t to deliver 15-25% price cuts on key food staples: Business leadershave agreed with the government to reduce the prices of key food items starting next Saturday. At a press conference yesterday, Prime Minister Moustafa Madbouly said that the government and private-sector food producers and traders will both reduce prices of 10 food items by 15-25% following an agreement with key business groups (watch, runtime: 21:23).

On the list: Beans, lentils, dairy, white cheese, pasta, sugar, cooking oil, poultry, eggs, and rice. The government will expand the list to cover other goods at a later stage, Madbouly said.

Yes, but: It’s unclear how many businesses will start lowering prices from Saturday. The move has the backing of the Federation of Egyptian Industries, the Federation of Egyptian Chambers of Commerce ( Fedcoc ) and the Poultry Producers Union. Supply Minister Ali El Moselhy said that the government will monitor the implementation, but did not say how.

Customs breaks: The government has also handed producers and retailers a six-month customs break in an attempt to keep prices low.

Remember: Food has been one of the key drivers behind the soaring headline inflation rate. Prices accelerated by a record 71.4% y-o-y in August. Rising prices of staple commodities have pushed the government to intervene in recent days by banning onion exports and preventing traders from purchasing sugar.

HAPPENING TODAY- It’s World Economic Outlook day. The last of 2024’s updates to the IMF’s widely read World Economic Outlook is due out today. The IMF and World Bank are holding their annual meeting this week in Morocco. You can check in on the proceedings here.

ELECTION 2023-

A third candidate joins the presidential race: The Wafd Party’s Abdel Sanad Yamama has filed paperwork with the National Elections Authority to run in the upcoming presidential election, Masrawy reports. He joins President Abdel Fattah El Sisi and the head of the Egyptian Social Democratic Party, Farid Zahran. The Republican People’s Party Hazem Omar is also expected to join the race after securing the required endorsements from MPs.

More to come? Former MP Ahmed Tantawi and head of the Dostour Party Gameela Ismail are also trying to collect signatures. Tantawi, who has accused authorities of suppressing his campaign, made a last-ditch call to the public yesterday to turn out at notary offices to nominate him. Candidates can file running papers until Saturday, 14 October.

WATCH THIS SPACE-

Panda and samurai are bands are still on their way: We’re still on course on for a USD 500 mn CNY-denominated panda bond issuance and a second JPY-denominated samurai issuance worth USD 500 mn despite Moody’s downgrading our sovereign credit and the economic turmoil stemming from the ongoing violence in Israel and Palestine, according to Al Borsa, citing an unnamed government official.

IN THE HOUSE-

Will foreigners soon be allowed to become importers? The House Economic Committee is meeting today to discuss changes to the law regulating the importers registry that would allow foreign investors to register as importers under 10-year licenses.

The thinking: boost FDI. The move would make it easier for foreign companies to import goods and production inputs into the country by removing the need for them to contract with an Egyptian middleman. It was one of 22 decisions introduced by the Supreme Investment Council in May in efforts to boost investment, and received the greenlight from the Madbouly cabinet in July.

THE BIG STORY ABROAD-

That remains the war in Gaza, which we cover this morning at the head of the news well. The story leads the front pages of all the major global business news outlets after Hamas threatened to start killing some of the c. 150 people it has taken hostage. The conflict is on every front page this morning, from the Associated Press and Reuters to the New York Times and the Wall Street Journal.

The death toll: Some 900 Israelis are confirmed dead, alongside nearly 690 Palestinians.

Arab League foreign ministers will hold an extraordinary session in Cairo tomorrow, Youm7 reports.

MEANWHILE- The 2023 Nobel Prize in economics goes to went to American economic historian and Harvard professor Claudia Goldin for her research into pay gaps between men and women, according to a statement (pdf) by the Royal Swedish Academy of Sciences, which chooses the Nobel Prize laureates in economic sciences. The news is everywhere in the foreign press: NY Times | Bloomberg | Reuters | The Guardian | Associated Press.

SOUND SMART- The prize in economics isn’t one of the five established in Alfred Nobel’s will back in 1895. Formally known as the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, the award is looked after by the Nobel Foundation and was established in 1968 by the Swedish central bank.

CIRCLE YOUR CALENDAR-

Scale Up’s first startup exhibition is coming next month: 500 Global’s startup mentorship program Scale Up will hold an exhibition in Egypt for its first batch of startups on 16 November, it said (pdf) this week. The invite-only event, which will take place at the Creative Giza Hub managed by ITIDA, will give startups the platform to showcase their products, bringing together industry experts, mentors, and entrepreneurs.

FYI- The Scale Up program, which kicked off on 1 October, is a joint venture between the Silicon Valley VC and ITIDA. The seven-week program focuses on local pre-series A startups, offering them the mentorship necessary to help them scale up their operations.

The lineup: Birdnest | Blnk | Convertedin | Dress Code | FriendlyCar | Illa | Khazenly | MQR | Nowlun | NowPay | O7 Therapy | Orcas | Rology | Suplyd | Slyndr.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

*** It’s Going Green day — your weekly briefing of all things green in Egypt: Enterprise’s green economy vertical focuses each Tuesday on the business of renewable energy and sustainable practices in Egypt, everything from solar and wind energy through to water, waste management, sustainable building practices and how you can make your business greener, whatever the sector.

In today’s issue: Egypt’s push for “smart” green projects in rural areas.