Egypt’s stocks tumbled on Monday, following an unexpected decision by the CBE to raise interest rates by 2%, with local investors selling and foreign investors ending up as net buyers. “The Egyptian central bank’s surprise decision to hike its benchmark interest rate appears to be the result of pressure from the IMF. “With every rate hike, the market’s reaction is the same; the local investors switch to the banking sector,” he added. A new hike in interest rates may lure investors to pump their cash into banking assets and abandon other relatively high-risk assets like stocks. Egyptian and Arab investors were net sellers of EGP 349.8m, while foreigners were net buyer of EGP 392.6m.

Source: Daily News Egypt May 22, 2017 15:44 UTC