What we’re tracking on 19 June 2019
Egypt greeted the death of Islamist former president Mohamed Morsi with a collective shrug, but it remains this morning the defining story about our country in the outside world, driving the narrative from North America to Europe.
Where is the “Shut Up Your Mouse” woman when you need her? The usual suspects are braying (note the dateline if you’re clicking on that last one), led by the nutter in Turkey, who “cast doubt on the official explanation” for Morsi’s death. “I don’t believe this is a natural death,” Erdogan said at symbolic funeral prayers for Morsi in Istanbul.
World leaders remain relatively mute on Morsi’s death on Monday after suffering a heart attack in a Cairo courtroom, but the UN’s human rights office (no fan of Egypt for some time now) joined Erdogan in calling for an independent investigation, spokesman Rupert Colville said in a statement. Human Rights Watch wasn’t far behind, and Iran issued a statement offering condolences and wishing “success for the great Egyptian nation.”
Meanwhile, in the world most of us inhabit:
Pharos’ annual investor conference (pdf) will kick off today in Hurghada. The two-day event will bring together investors, IPO prospects and more than 40 listed companies for meetings with institutional investors.
Meanwhile: Cairo Technology Week will wrap up tomorrow, marking the end of this week’s series of tech-heavy events. The week also saw the IDC CIO Summit 2019 for the Middle East, Africa and Turkey and Seamless North Africa fintech and ecommerce conference, at which CBE governor Tarek Amer made public statements about the sales of United Bank and Banque du Caire.
Is the Fed about to cut interest rates? Not this time, says El Erian: The US Federal Open Market Committee (FOMC) will announce today its decision on interest rates as it wraps its two-day meeting. Emerging market economies, some of which have begun cutting interest rates this year, are hoping for a rate cut, but markets sage and Allianz chief economic advisor Mohamed El Erian thinks they’ll be left waiting another month: “The first cut will probably not take place this week but rather at the next FOMC meeting scheduled for 30-31 July,” he writes in a must-read piece for Bloomberg. “It is likely to amount to a 25-basis-point reduction as part an open-ended cycle of rate cutting, with a smaller probability of a 50-basis-point ‘one and done’ approach,” he says.
El Erian suggests that the Fed wants to stick to its “dovish” narrative on rates signalled by Fed Chairman Jerome Powell at the beginning of the year, meaning a rate cut is coming. But at the same time, the Fed’s own data on the FOMC’s views about where interest rates should go could point to a rate hike, which is sending mixed signals to investors, according to the Wall Street Journal. In the face of a turbulent maco climate and “a fluidity” in the US economy, “the Fed will wish to retain as many policy options as possible, even if there is some risk of disappointing markets that are pressing for upfront signals of very dovish Fed measures,” El Erian says.
Meanwhile, European Central Bank chief Mario Draghi signaled in a speech yesterday that further rate cuts and fresh stimulus could be in the cards as soon as July. The Donald wasn’t happy about the idea of EU stimulus, taking to Twitter to accuse Brussels of “unfairly” manipulating the EUR, and warning that it had been “getting away with this for years, along with China and others.” The Financial Times has more.
Dude, this isn’t a reality TV show: The Donald also said yesterday he would like to “demote” Fed Chair Jay Powell, CNBC reports. A step below “You’re fired,” at least…
Facebook has unveiled its latest plans for world domination: The social media monolith plans to launch a new global currency, Libra, which the company says would allow bns of users to make purchases and low-cost money transfers around the world. Libra will launch as a standalone app and on WhatsApp and Messenger by 2020. It is the most significant move yet to bring blockchain technology into mainstream use, with Facebook claiming its primary goal is financial inclusion.
Zuckerberg apparently wants his currency to eventually challenge the USD, extending the social media giant’s power over not just our data and access to information, but a global means of exchange. To achieve this, the company is looking to apply the same processes used to introduce hard currencies in the past, Bloomberg writes.
Members of Congress have some minor reservations about the idea… Several US legislators have cast doubts on whether a company with such a troubled history of handling data and protecting privacy should be given the power to control a global currency, Axios notes.
The move is being backed by 28 companies, including Visa, Mastercard, Lyft and Spotify, but traditional banks and large tech groups are not yet on board. The FT, Reuters and the Guardian all have more.
In miscellany this morning:
- 7.4 tons of Venezuela’s gold landed in Uganda on a Russian charter in March — and promptly disappeared, exposing what the Wall Street Journal calls an “underground economy many suspect is helping Nicolas Maduro cling to power.”
- The Qatar Investment Authority is ramping up investment plans in emerging and developed markets in what the Financial Times is calling a “return to form” after it pulled USD 20 bn from overseas markets to shore up its accounts after the statelet opened its conflict with Egypt, the UAE and Saudi Arabia.
- Qatar is still dodging allegations that it bought the World Cup after disgraced former UEFA President Michel Platini was taken into custody yesterday as part of a French probe into allegations that FIFA officials took bribes from Qatar in the statelet’s bid to host the World Cup in 2022.
On the topic of football: We have just two days to go before the African Cup of Nations 2019 kicks off in Cairo Stadium on Friday at 10 PM CLT. Look for a daytime high of 38°C when you’re lining up to enter the stadium, cooling to 24°C overnight.
PSA- Are you a landlord with a rental property? The cops want you to register online — now. Landlords can now use an Interior Ministry portal to register properties they rent out, the ministry said in a statement. Landlords who fail to register leased properties with the police could face up to a year in prison and fines of as much as EGP 10k under amendments to the Anti-Terrorism Act approved by Cabinet in February.