The Central Bank of Egypt withdrew liquidity worth EGP 1.033 trillion in open market bidding today from 26 banks after its recent decision to amend policies for accepting bids with an interest rate of 27.75%.
The Central Bank withdrew liquidity worth 1.135 trillion pounds in open market tender from 26 banks last week.
The Central Bank had issued new instructions regarding the rules governing the main process of linking deposits (Main) Operation) for open market operations that the Central Bank was conducting by holding a fixed-rate auction (Fixed-rate Tender) on a weekly basis, where the size of the operation that it would conduct was announced. The Central Bank accepts bids using the allocation method, which is determined based on the ratio of the bid submitted by the bank to the total bids submitted and the main transaction price is applied to it.
The Central Bank confirmed that, in light of its keenness to follow the best international practices regarding managing surplus liquidity in the banking system and improving the impact of monetary policy decisions, it was decided to change the method of accepting bids for the main process of linking its deposits (Main Operation) from the allocation method to the method of accepting all submitted bids. Full Allotment), starting from April 23, 2024, provided that the results of each linking process are published on the website of the Central Bank of Egypt.
The Central Bank will continue to manage liquidity in a way that achieves balance to ensure its consistency with its operational goal, which is to maintain the weighted average return rate for one night in the interbank market around the operation price, which is the main one, which is the average corridor price.
