{"id":631646,"date":"2018-03-25T04:11:26","date_gmt":"2018-03-25T04:11:26","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2018\/03\/25\/what-were-tracking-on-25-march-2018\/"},"modified":"2018-03-25T04:11:26","modified_gmt":"2018-03-25T04:11:26","slug":"what-were-tracking-on-25-march-2018","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2018\/03\/25\/what-were-tracking-on-25-march-2018\/","title":{"rendered":"What we\u2019re tracking on 25 March 2018"},"content":{"rendered":"

It\u2019s a very busy news morning as the first quarter roars to a close<\/strong>, with a presidential election set to take place in Egypt this week, expectations that the central bank will cut interest rates on Thursday, and global markets looking at a potential sell-off when markets open tomorrow, sparked by the prospect of a trade war.<\/p>\n

The Ismail Cabinet will present its draft FY2018-19 budget to President Abdel Fattah El Sisi this week for approval<\/strong> before shipping it to the House of Representatives at the end of the month, Finance Minister Amr El Garhy told Al Masry Al Youm<\/a> on Saturday. The minister reiterated that the budget would have a GDP growth target of 5.8%, a aim for a budget deficit of 8.4% of GDP, and increase spending on social welfare, wages, and commodity subsidies.<\/p>\n

Bloated public sector gets even bloat-ier:<\/strong> Spending on wages of state bureaucrats will increase to EGP 268 bn in next year\u2019s budget, up from EGP 240 bn this fiscal year, said Vice Minister of Finance Mohamed Maait, according to AMAY<\/a>. The wage increases will go into effect on 30 June, he added \u2014 assuming, of course, the House approves the budget on time.<\/p>\n

As for the state IPO program<\/strong>, El Garhy said the government was meeting with investment banks to decide the first of the 23 state companies slated for a listing.<\/p>\n

Our own central bank\u2019s Monetary Policy Committee is set to <\/strong>meet on Thursday<\/strong><\/a> to decide on interest rates.<\/strong> With annual urban inflation dropping to 14.4% \u2014 the lowest rate since October 2016 \u2014 the CBE has recently hinted<\/a> at a possible rate cut by saying that inflation appears under control in the medium-term. Research houses have been unanimous<\/a> in saying that the CBE might cut interest rates again this month, predicting a cut of 50-200 bps.<\/p>\n

Our friends at Pharos Holding expect a 100 bps cut on Thursday.<\/strong> You can read Pharos\u2019 full report here (pdf)<\/a>.<\/p>\n

<\/a> Presidential campaigns in pre-poll quiet period, polling stations open tomorrow with tighter security: <\/strong>Security at polling stations has been tightened after a terrorist bombing in Alexandria killed two policemen, according to state-owned Al Ahram<\/a>. The two presidential campaigns are in a constitutionally mandated quiet period today, with voting due to begin tomorrow and end on Wednesday<\/strong>, 28 March. Companies are being asked to give staff sufficient time during the workday to make it to and from their polling station. Results are due to be announced on Monday, 2 April.<\/p>\n

<\/a> Wall Street closed deeply in the red on Friday, prompting fears of a fresh selloff in global markets this week.<\/strong> The S&P 500 fell 2.1% on Friday to close the week down 6% as China hit back<\/a> at the US tariffs on some USD 60 bn worth of goods and services<\/a>, sparking fears of a global trade war. All three primary US equity indices had their \u201cworst weekly declines in more than two years,\u201d the Financial Times<\/a> notes. Beijing is urging the US to \u201cpull back from the brink.\u201d CEOs, including BlackRock\u2019s Larry Fink and Apple\u2019s Tim Cook<\/a>, urged restraint.<\/p>\n

Sound smart: Two pieces you want to read for context<\/strong>, both from the New York Times:Trump is \u201cpushing the World Trade Organization toward irrelevance<\/a>,\u201d the paper writes, saying his move clearly stands as \u201canother retreat from the postwar\u201d liberal democratic capitalist world order<\/a> and \u201cback toward the 19th-century ways of nationalism, protectionism and great-power rivalry.\u201d<\/p>\n

Also worth noting as we get the week underway:<\/p>\n