{"id":596718,"date":"2019-07-07T04:43:50","date_gmt":"2019-07-07T04:43:50","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2019\/07\/07\/what-were-tracking-on-8-july-2019\/"},"modified":"2019-07-07T04:43:50","modified_gmt":"2019-07-07T04:43:50","slug":"what-were-tracking-on-8-july-2019","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2019\/07\/07\/what-were-tracking-on-8-july-2019\/","title":{"rendered":"What we\u2019re tracking on 8 July 2019"},"content":{"rendered":"

Welcome back, ladies and gentlemen <\/b>\u2014 it\u2019s a busy start to what\u2019s likely to be a busy week. We have June\u2019s inflation data coming out in the next few days, and on Thursday, 11 July, the central bank\u2019s Monetary Policy Committee will meet to review key interest rates. The consensus among our poll of economists (which you\u2019ll find in this morning\u2019s Speed Round, below) is that the central bank will leave rates on hold for another month as it assesses the inflationary impact of the fuel subsidy cuts.<\/p>\n

Speaking of which: Your commute is officially more expensive.<\/b> Fuel prices rose between 16% and 30% over the weekend as the government pushed ahead with the latest round of subsidy cuts. We have chapter and verse in this morning\u2019s Speed Round, below.<\/p>\n

New fiscal data was also released over the weekend \u2014 and it doesn\u2019t make great reading.<\/b> Rising imports caused the current account deficit to almost double year-on-year in the first nine months of FY2018-19, while the balance of payments swung from enjoying an USD 11 bn surplus to turning a deficit of USD 350 mn over the same period. The full breakdown is also in Speed Round, below.<\/p>\n

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President Abdel Fattah El Sisi is in Niger today<\/b> to attend an extraordinary African Union summit. The gathering will see the launch of the operational phase<\/a> of the African Continental Trade Agreement (AfCFTA), which came into force<\/a> on 30 May. We have more on this in Last Night\u2019s Talk Shows, below.<\/p>\n

<\/a> The House of Representatives is scheduled to end its current legislative session and recess for the summer this week<\/b>, unidentified sources told reporters yesterday, according to Ahram Online<\/a>. Our esteemed representatives have a few more bills to get through before rushing to the beach, including a draft law<\/a> to regulate the Bar Association and amendments the \u201cold rent\u201d law<\/a>, among others. By law, President Abdel Fattah El Sisi must call in the first session of the House by the first Thursday of October. The next legislative season will be the last before new representatives are elected to parliament.<\/p>\n

A World Bank delegation will visit several industrial zones in Qena<\/b> on Tuesday, 9 July, according to Youm7<\/a>.<\/p>\n

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<\/a> Well, we\u2019re officially out of Afcon:<\/b> Our African Cup of Nations run was, sadly, cut short yesterday by South Africa, which netted an 85th-minute lead past Mohamed El Shennawy (even his sizeable hands couldn\u2019t save us). Yesterday\u2019s match result was not all that surprising, but it managed to set off a domino effect of chaos in Egypt\u2019s football scene.<\/p>\n

Egyptian Football Association (EFA) President Hany Abo Rida resigned from his post following the defeat<\/b>, but will continue to lead the committee in charge of organizing Afcon until the tournament wraps up, the EFA said in an overnight statement<\/a>. He also sacked the national team\u2019s entire coaching staff, saying that \u201cthe decision is an ethical obligation.\u201d Senior officials told Egypt Today<\/a> following Abo Rida\u2019s departure that authorities will launch an investigation into the EFA\u2019s suspected \u201cadministrative and financial violations,\u201d which allegedly had a direct correlation with the loss. Abou Rida has been at the helm of the association since August 2016. EFA board members Hazem Emam and Seif Zaher also announced their resignation<\/a> shortly after Abo Rida\u2019s, alongside Ahmed Megahed<\/a> and Essam Abdel Fattah<\/a>.<\/p>\n

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Strong US jobs report dampens expectations for deep Fed rate cut:<\/b> US jobs growth surged in June, beating out economists\u2019 predictions and shortening the odds of a deep rate cut by the US Federal Reserve later this month, the FT reports<\/a>. Nonfarm payrolls tripled to 224k last month from the 72k added in May, making June the best month of 2019 for job growth. The positive data lessens the pressure on the Fed to make a deep rate cut when it meets on 30-31 July, and increases the possibility that officials will instead opt for a minor 25 bps cut.<\/p>\n

Wall Street didn\u2019t see the positives:<\/b> The three main US indices closed in the red<\/a> on Friday, with the Dow down 0.16%, the S&P 500 shedding 0.18% and the Nasdaq losing 0.10%. The yield on US 10-years meanwhile moved back above 2%<\/a> on the news.<\/p>\n

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The market is getting \u201ccarried away\u201d with expectations for multiple Fed rate cuts- El Erian:<\/b> Market predictions for several rate cuts by the US Federal Reserve this year are unrealistic, market guru Mohamed El Erian told CNBC\u2019s \u2018The Exchange\u2019 on Friday (watch, runtime: 3:09<\/a>). \u201cWe as the market base have gotten carried away, carried away thinking it will be 50 bps in July, thinking we\u2019re going to get three cuts by the end of the year,\u201d he said. \u201cWe\u2019re going to get one in July and maybe, maybe two, and that\u2019s about it.\u201d<\/p>\n

El Erian predicts that the Fed will make a 25 bps cut when it meets this month<\/b>, instead of a deeper 50 bps cut recently forecast by many market watchers.<\/p>\n

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Do we finally have a truce in Sudan? <\/b>Military and protest leaders in Sudan agreed on Friday to share power in a joint military-civilian council tasked with seeing the country through a three-year transitional period before elections in 2022, the Wall Street Journal reports<\/a>. The truce could mark an end to months of protests and violence for our southern neighbor, which led to the ouster of long-time President Omar Bashir in April.<\/p>\n

In international miscellany:<\/p>\n