Central Bank of Egypt hikes, but still work to do

The Central Bank of Egypt unexpectedly hiked interest rates late yesterday, by 100bp to 19.25%, but it still needs to follow through with another devaluation as well as further rate hikes in order to get investors back on board. With growing signs that the FX crunch is hurting economic activity, action will need to arrive sooner rather than later in order to avoid a messy balance of payments crisis.

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