Good afternoon, ladies and gents, and welcome to this week’s penultimate PM edition. This time next week we’ll be closing out a day early thanks to Islamic New Year.

It’s interest rate day tomorrow: It’s the big day at CBE HQ tomorrow as the Monetary Policy Committee meets to review interest rates. Analysts we talked to last week are convinced that our central bankers are going to play it safe and leave rates unchanged until at least next month. The potential for a pick-up in inflation in the coming months and a need to maintain Egypt’s world-beating real rates will mean that the central bank’s easing cycle remains on hold, according to our poll.

THE BIG NEWS THIS AFTERNOON- Only regulatory approvals now separate Vodafone Egypt from getting its hands on 20% stakes in Ebtikar’s e-payments platforms Bee and Masary after the telecoms giant wrapped up due diligence. Meanwhile, a EGP 1 bn bond issuance could help Mercedes’ local partner enter the EV market, US manufacturing giant HB Fuller has announced a new facility in Sixth of October, and in the last hour we received July’s foreign reserves figures courtesy of the central bank, showing that the nation’s stockpile continued to inch up last month. All that and more in this afternoon’s Speed Round section, below.

HAPPENING NOW- It’s the final day for the Africa Food Manufacturing exhibition at the Egypt International Exhibition Center.

DRIVING THE GLOBAL BUSINESS NEWS AGENDA THIS AFTERNOON-

Global shares hit record highs in trading today, backed by strong corporate earnings that have buoyed equity markets, according to Reuters. The MSCI World index was up 0.2%, while the equivalent index in Asia gained 0.9%, excluding Japan. Markets were also sunny in Europe, with the Stoxx Europe 600 and FTSE 100 both up 0.5%-0.6%.

Markets in the world’s biggest economy weren’t quite so optimistic, however, as American investors wait on some big announcements, including employment data that could help determine when the Federal Reserve decides to turn off the liquidity taps. US equity futures were marginally in the green ahead of dispatch time while the USD hovered 0.1% up against a basket of currencies.

Will Biden stick with Powell at the Fed? The majority of Fed watchers are expecting US President Joe Biden to stick with Jerome Powell as the Fed chair for another four years. Biden is expected to make a decision next month on whether Powell, whose first stint expires next February, will stay on for another term. Tradition — which Donald Trump broke with back when he nominated Powell in 2018 — dictates that an incoming president does not switch out a Fed head appointed by their predecessor, and if Biden bucks the trend for another pick, he risks scaring the markets, Bloomberg suggests.

Who’s the most likely alternative? Lael Brainard, seven-year Fed board member and favored candidate of progressives, is reportedly the leader to replace Powell should Biden give him the boot. A Brainard pick, who this week drew a line in the sand by coming out in favor of tighter regulations and a digital USD, wouldn’t be greeted favorably by markets, who worry about greater market controls.

The “Nasdaq Whale” resurfaces: SoftBank has bought a USD 5 bn stake in Swiss pharma firm Roche, sources close to the transaction told the Financial Times. The acquisition was led by Akshey Naheta, head of the SoftBank unit that was roundly criticized after it was revealed to be the “Nasdaq whale” behind a series of huge derivatives trades that stoked last year’s tech rally and lost the company bns of USD.

THE BIG STORIES IN THE REGION-

It’s been a year since the tragic Beirut port blast that shook the country as it undergoes a devastating economic crisis.

President Abdel Fattah El Sisi is joining a donor conference being organized by French President Emmanuel Macron, which is seeking to raise USD 350 mn in aid for Lebanon. El Sisi said that Lebanon would “rise from the current setback” and regain its standing as a beacon of culture, art, and thought, according to an Ittihadiya statement.

The story is getting a lot of attention in the foreign press: France 24 | AP | New York Times | CNN.

Another maritime incident is apparently unfolding in the Gulf, as a merchant vessel has been reported safe after it was boarded by suspected hijackers off the UAE coast yesterday. A British Royal Navy body that monitors Gulf maritime operations described the possible hijack as “complete” based on information from a third party, without giving further details.

Plenty about this apparent attack remains murky, including the identity of the vessel and the hijackers. UK and US officials declined to confirm reports that the attack was carried out on the asphalt/bitumen carrier Asphalt Princess, and said investigations were at too early a stage to identify the “boarders.” The US Navy on Tuesday sent a ship to monitor the situation.

While governments have so far held back on officially naming the culprits, fingers are inevitably pointing to Iran, after it was blamed for last week’s drone strike on an Israeli-owned oil tanker in the Persian Gulf in which two people were killed. Iran’s foreign ministry said it was “suspicious” about the recent spate of Gulf shipping incidents, while the Revolutionary Guards denied involvement. The escalating Gulf tensions come as Iran this week saw its new president sworn in, and the attempted revival of the US-Iran nuclear pact struggles on.

YOUR DAILY DOSE OF COVID NEWS- The delta variant is continuing to cause problems in Asia:

• China is going back into lockdown: Beijing is shutting down trains, closing internal borders, and sealing cities as new covid cases continue to emerge across the country. Seventeen of the country’s 31 provinces are now reporting cases in what is one of the country’s worst outbreaks since the pandemic began. (AP | The Guardian)
• Japan is facing a predictable covid spike: Japan and capital city Tokyo are now reporting record daily covid cases thanks largely to the Olympic Games, which has led to the delta variant becoming more prevalent in the country. (Reuters)

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

• Subsidized bread could rise in price for the first time in a generation: President Abdel Fattah El Sisi called on the government to raise bread prices for the first time in decades during a speech yesterday, though didn’t specific how much the 5-piaster baladi loaf should increase.
• Orascom Development Egypt fighting USD 34 mn fine: The Environment Ministry is asking Orascom Development Egypt to cough up almost USD 34 mn for alleged environmental damage caused by its El Gouna development.
• Credit risk is falling in the banking sector: Pressure on Egyptian banks’ credit profiles has eased since 3Q2020 thanks to an improving operating environment, according to Fitch Ratings.

Subscribe to Enterprise

???? CIRCLE YOUR CALENDAR-

Euromoney Conferences is organizing a two-day virtual conference from 7-8 September to talk sustainable finance and investment. Titled “GlobalCapital Sustainable and Responsible Capital Markets Forum,” the online event will feature on day one Vice Minister of Finance Minister Ahmed Kouchouk, who will participate in a live panel discussion on green sovereign bonds. You can register for the webinar here.

The Dokki Book Fair will be held from 5-10 August at the Ebda3 Villa, boasting 1 mn books on sale at this year’s event.

Inflation: Inflation data for July will be out on Tuesday, 10 August.

???? FOR YOUR COMMUTE-

Toyota is playing dirty in efforts to catch up to EV automakers: When Toyota banked heavily on hydrogen-powered hybrid cars in a revolutionary move by car makers, it put all its eggs in one basket and fell behind on the electric vehicle trend. In efforts to gain ground, a New York Times investigation found that a high ranking Toyota executive Chris Reynolds has been lobbying Washington lawmakers to slow the advance of EVs in policy measures while touting the importance of hybrids (such as their Prius).

These efforts have already borne fruit, with the Biden administration’s infrastructure spending bill cutting the expected government funding for expanding EV charging stations in half. The dirty politics and disregard for climate regulations all fuel Toytoa’s long-term strategy for hydrogen and give it ample time to catch up to manufacturers such as Audi, Ford, Hyundai, Jaguar, Porsche, Volvo, and Volkswagen who all currently have at least one EV for sale.

Meanwhile, General Motors (GM) and Ford are being urged by investors to advance plans in EV production, despite a surge in demand for traditional cars and trucks, according to the Financial Times. Nonetheless, GM has committed USD 35 bn to manufacture EVs by 2025 while Ford has set aside USD 30 bn for the same period, as they too fear being left in the dust by the advent of EVs by the likes of Tesla.

???? ON THE TUBE TONIGHT-

The existence of UFOs is not just likely, but a certainty is a notion many people believe in Netflix’s Top Secret UFO Projects: Declassified. The new six-part docuseries examines various efforts by the US and UK governments to cover up evidence that UFOs have made multiple appearances in the past 80 years. Delving into the history of these sightings and how they’ve been documented by multiple sources, the series ultimately focuses on the government response to these sightings as opposed to figuring out whether they could be true or not. If you’re into the prospect of alien existence this show will be interesting, but brace yourself for a ton of conspiracies and little fact.

⚽ Al Ahly are playing against Wadi Degla in the Egyptian Premier League tonight at 9pm.

???? TODAY IN THE TOKYO OLYMPICS-

Wrestler Mohamed Ibrahim Kicho has won Egypt another Olympic bronze medal today, beating Artem Surkov of Russia in the Greco-Roman 67kg event.

Wrestler Mohamed Metwally came in fifth place in the Greco-Roman 87kg, after losing to Germany’s Denis Maksymilian Kudla in the bronze event.

Mouda Zeyada finished in 19th place in the equestrian individual jumping final, for a top 20 Olympic finish for the rider. Meanwhile, Nayel Nassar finished in 24th place in the final event.

Maha Gouda finishes in 20th place in the women’s 10m diving event, the best finish by an Egyptian woman in Olympic history. There is a chance she could advance to the semis as she is currently placed as a reserve for the event.

Samaa Ahmed came in last place in the canoe sprint women’s K-1 500m quarterfinals, losing her chance to go to the semis.

Moemen Mahran also bowed out of the canoe sprint men’s K-1 200m after coming in fourth place.

Athlete Ihab Abdelrahman just barely lost his chance to qualify for the javelin throw final, coming in 8th place while the first seven Group A athletes qualified.

WHAT TO WATCH tonight and tomorrow-

• 4:05am: Mostafa Amr Hassan is competing in the athletics men’s shot put finals.
• 4:30am: Diaaeldin Abdelmottaleb is up against Georgia’s Geno Petriashvili in the wrestling men’s freestyle 125kg round of eight.
• 5:12am: Amr Reda Hussen will compete against Poland’s Kamil Rybicki in the wrestling men’s freestyle 74kg round of eight.
• 6:00am: Amira Kandil and Haydy Morsy will participate in the women’s fencing pentathlon ranking round.
• 9:30am: Ahmed Hamed and Ahmed ElGendy are up in the men’s fencing pentathlon ranking round.
• 10:00am: Egypt’s handball team will play against France in the semifinal, in the biggest game of the day and maybe the Olympics altogether.

A ton of karate events are also taking place tomorrow, with the Egyptian athletes having good chances of gaining medals. The times of the matches are still TBD:

• Ali El Sawy has four matches tomorrow in the men’s kumite 67kg against Japan, Turkey, Azerbaijan, and Kazakhstan in a Pool A elimination round.
• Meanwhile, Radwa Sayed is up in the women’s kumite 55kg, playing against Kazakhstan, Ukraine, Japan, and Austria in Pool B.

???? OUT AND ABOUT-

Traditional Zar ensemble Mazaher are performing tonight at Downtown Cairo’s Makan at 8pm.

???? UNDER THE LAMPLIGHT-

This year’s Pulitzer Prize in Biography went to The Dead Are Arising: The Life of Malcolm X. Written by the late investigative journalist Les Payne with help from family member Tamara Payne, the book follows the prominent reporter’s nearly thirty-year journey researching Malcolm X’s life. He interviewed everyone who had been in contact with the civil rights activist, including all his living siblings, classmates, street friends, cellmates, Islamic figures, FBI moles and cops, and political leaders around the world. The resulting book deftly recounts Malcolm X’s life as he goes “from street criminal to devoted moralist and revolutionary” while examining his impact on the struggle for African American rights.

☀️ TOMORROW’S WEATHER- Expect the mercury to go up to 44°C tomorrow during the day in Cairo and fall to 27°C at night, according to our favorite weather app. Sahel will have 36°C weather during the day and 24°C at night.