CBE withdraws EGP 567.45b in open market operation to manage liquidity

The Central Bank of Egypt (CBE) conducted an open market operation (OMO) on Tuesday, absorbing 567.45 billion Egyptian pounds from the banking system as part of its ongoing liquidity management strategy and efforts to regulate market interest rates.

A total of 28 banks participated in the auction, with accepted bids set at an interest rate of 27.75 per cent, aligning with the CBE’s updated bid acceptance policies.

In 2024, the CBE introduced key reforms to its OMO framework to enhance monetary policy efficiency. A major shift came in April with the adoption of a full allotment system, enabling all eligible banks to participate in weekly liquidity auctions. This transition from an allocation-based model has provided greater flexibility and improved liquidity distribution across the banking sector.

These continuous refinements to its monetary policy tools reaffirm the CBE’s commitment to economic stability and the sustainable development of Egypt’s financial system.

Attribution: Amwal Al Ghad English