What to Expect from the Final 2021 Fed Meeting🤷‍♀️

Local Pickup🌇

Egypt’s Budget Deficit Records EGP 219.8 Billion During July-October 2021⚖️

Egypt’s budget deficit recorded EGP 219.8 billion, equivalent to 3.1% of GDP during the 4-month period from July to October 2021, compared to EGP 171.3 billion pounds, equivalent to 2.6% of GDP during the same period last year.

What is the Budget Deficit🤷‍♀️ A budget deficit occurs when government expenditures exceed its revenues, & is used as an indicator of a country’s financial health. 

Budget Deficit as a % of GDP🤨 Generally, budget deficits as a percentage of GDP tend to decrease in times of economic prosperity, & increase when the economy isn’t doing as well.

More Details🧐 Total revenues increased 8.4% year-over-year to record EGP 311.3 billion. Tax revenues & non-tax revenues contribute 78.8% & 21.2% of total revenues, respectively.

Total expenditures rose 16.6% year-over-year to record EGP 530.7 billion. 

Why is this Important🤔 Budget deficits could lead to inflation, as central banks may need to increase the money supply in the economy, which would increase inflation. To reduce budget deficits, governments could reduce spending, increase revenue, or a combination of both.

Eastern Company to Start Manufacturing New Cigarette Product🚬

Eastern Company (EAST) signed an agreement with Al Mansour International Company to manufacture the “Evolve” product in different brands, under the “Davidoff” product line.

More Details🧐 EAST stated that Evolve is produced by British tobacco company Imperial Tobacco Group, which Al Mansour International has represented in the Egyptian market for a long time.

Why is this Important🤔 The company said that the Evolve product will be sold for a mid-range price of EGP 32 per 20-cigarette pack.

ICMI Capital Increase Subscribed 0.69x🧧

The International Company for Medical Industries’ (ICMI) capital raise recorded a 69.21% subscription coverage ratio to the company’s capital raise.

More Details🧐 The FRA had approved ICMI’s request to increase capital from EGP 24.19 million to EGP 72.57 million by issuing 48.38 million shares at EGP 1/share.

Why is this Important🤔 The 69.21% subscription coverage ratio means that subscribed shares amounted to ~33.48 million.

Global Pickup🌎

The Fed Meets Again Today & Tomorrow. Here’s What to Expect👇

The U.S Federal Open Market Committee (FOMC) is meeting today & tomorrow for the final time in 2021, & markets will be watching very closely.

More Details🧐 The Fed is mainly expected to discuss speeding up the end of its bond-buying program, & could also begin to raise interest rates faster amid rising inflation. 

And of course, we can’t forget Omicron, although market participants are less concerned about it after it became clear that Omicron is unlikely to cause the economy to shut down. 

Why is this Important🤔 Experts don’t expect much market reaction unless the Fed’s messaging includes a surprise or its forecast for interest rate hikes is more aggressive than expected. 

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