Egypt’s CBE withdraws EGP 531.9b in open market operation

The Central Bank of Egypt (CBE) successfully conducted an open market operation (OMO) on Tuesday, withdrawing 531.900 billion Egyptian pounds from the banking system as part of its ongoing strategy to manage liquidity and regulate market interest rates.

A total of 26 banks participated in the auction, with accepted bids set at an interest rate of 27.75 per cent, in line with the CBE’s updated bid acceptance policies.

As part of its broader monetary policy reforms, the CBE has introduced key enhancements to its OMO framework in 2024 to improve efficiency and liquidity management. A significant milestone was reached in April with the adoption of a full allotment system, allowing all eligible banks to participate in weekly liquidity auctions. This shift from an allocation-based model has increased market flexibility and optimized liquidity distribution across Egypt’s banking sector.

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

Attribution: Amwal Al Ghad English