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The economics lecturer at the American University in CairoHani Genena, behind the scenes of a decision central bankindicating that there is a so-called interest rate set by the Central Bank on lending and borrowing by banks from each other in the so-called interbank process, and the interest rate on these operations must be fixed at a certain number.
He continued, in statements to the site "Sky News Arabia" That in case of excess of Liquidity The banks have more than the normal limit Benefit on me interbank It decreases, which increases the inflation rate in the country due to the increase in the supply of cash.
He explained that, for this reason, the Central Bank periodically submits a weekly bid to withdraw an amount of liquidity offered by the banks and invests it for them as deposits with it at an interest rate that it aims to maintain, which controls the issue of inflation in the market.
Genena pointed out that the exciting thing this week is that the bank Egyptian Central He requested in his weekly bid 100 billion pounds, but the banks offered more than 400 billion pounds, and this is a very large offer and in excess of the normal rate, as every time the central bank, for example, asked for 100 billion pounds, the supply from banks did not exceed 110 billion pounds.
He went on to say that the increase in the supply of banks above the normal rate is what sparked speculation this time that there was something, such as that the banks, for example, were keeping that liquidity in anticipation of the central bank’s decision, scheduled for Thursday, in which it is expected to raise interest rates on the bank. Lending And borrowing in pounds, and then the banks benefit from their excess liquidity, or the reason for the increase in the surplus is that the central bank bought dollars from the banks and injected large liquidity withEgyptian Pound In the market.
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The economics lecturer at the American University in CairoHani Genena, behind the scenes of a decision central bankindicating that there is a so-called interest rate set by the Central Bank on lending and borrowing by banks from each other in the so-called interbank process, and the interest rate on these operations must be fixed at a certain number.
And he continued, in statements to “Sky News Arabia”, that in the event of an increase in the surplus from Liquidity The banks have more than the normal limit Benefit on me interbank It decreases, which increases the inflation rate in the country due to the increase in the supply of cash.
He explained that, for this reason, the Central Bank periodically submits a weekly bid to withdraw an amount of liquidity offered by the banks and invests it for them as deposits with it at an interest rate that it aims to maintain, which controls the issue of inflation in the market.
Genena pointed out that the exciting thing this week is that the bank Egyptian Central He requested in his weekly bid 100 billion pounds, but the banks offered more than 400 billion pounds, and this is a very large offer and in excess of the normal rate, as every time the central bank, for example, asked for 100 billion pounds, the supply from banks did not exceed 110 billion pounds.
He went on to say that the increase in the supply of banks above the normal rate is what sparked speculation this time that there was something, such as that the banks, for example, were keeping that liquidity in anticipation of the central bank’s decision, scheduled for Thursday, in which it is expected to raise interest rates on the bank. Lending And borrowing in pounds, and then the banks benefit from their excess liquidity, or the reason for the increase in the surplus is that the central bank bought dollars from the banks and injected large liquidity withEgyptian Pound In the market.