Is the carry trade approaching a tipping point? CBE data on the balance of payments in April indicated that the foreign holdings of Egyptian debt fell 1.25% m-o-m to EGP 375.5 bn — the first drop in foreign portfolio investments in 2018, according to the local press. As our friend EFG Hermes lead economist Mohamed Abu Basha suggested to Al Mal earlier this week, “hot money” investors have curbed somewhat their appetite for Egyptian treasuries as the central bank’s started guiding interest rates down 1H2018. Early signs among rate watchers are that we’re looking at a slower pace of easing in the back half of the year — good news for the carry trade, not necessarily for the rest of us who were hoping lower rates might spark corporate borrowing for replacement capex, at least.