The Fed suggests coming rate hikes may be smaller: US Federal Reserve officials agreed to slow the pace of rate hikes moving forward to minimize recession risks, according to the newly released minutes of their December meeting — suggesting the Fed could go for a 25-basis-point hike when it next meets at the end of this month.

But it’s not easing up yet: Officials sought to avoid any “misperception” in the markets that the US central bank is giving up the fight against inflation, warning that the US central bank would need “substantially more evidence” that price hikes are cooling before it eases up on rates. The central bank raised rates by 50 bps at its final meeting of the year, a moderate increase by recent standards that brought to an end a run of four consecutive 75-bps hikes, bringing rates to 4.25-4.5%.

Goldman Sachs dealmakers predict a bounceback for M&A in 2H 2023: While most economists predict more tough economic times ahead, top dealmakers at Goldman Sachs are anticipating a rebound in global M&A in the second half of this year, Reuters reports. Global M&A dipped 36% y-o-y to USD 3.78 tn last year amid volatile markets and high borrowing costs. The Goldman execs say that means big investors have dry powder to spend and are waiting for financing conditions to improve before they pounce. A recovery may be “quicker than people expect,” said the bank’s global M&A co-head Mark Sorrell.

Goldman bankers will be hoping their prediction comes true: The world’s biggest M&A advisor by revenue cut 500 jobs in September as dealmaking dried up, and plans to lay off thousands more in the new year.

Also worth noting this morning:

• French inflation falls on cooling energy prices: Inflation in France dropped to 6.7% in December from 7.1% in November thanks to government intervention to bring down energy prices, in another sign that price pressures have peaked in major developed economies. (FT)
• Trouble for Meta in Europe: Facebook’s Meta has been fined EUR 390 mn by the Irish privacy regulator in a ruling that could stop the company from forcing users to accept personalized ads across the EU, a potential “huge blow” to the company’s business. Meta said it will appeal the decision. (WSJ | NYT | CNBC)

	EGX30	15,557	+3.3% (YTD: +6.6%)
	USD (CBE)	Buy 26.36	Sell 26.49
	USD at CIB	Buy 26.30	Sell 26.40
	Interest rates CBE	13.25% deposit	14.25% lending
	Tadawul	10,532	-1.2% (YTD: +0.5%)
	ADX	10,279	-0.1% (YTD: +0.7%)
	DFM	3,329	+0.0% (YTD: -0.2%)
	S&P 500	3,853	+0.8% (YTD: +0.4%)
	FTSE 100	7,585	+0.4% (YTD: +1.8%)
	Euro Stoxx 50	3,974	+2.4% (YTD: +4.8%)
	Brent crude	USD 77.84	-5.2%
	Natural gas (Nymex)	USD 4.15	-0.6%
	Gold	USD 1,862.20	+0.2%
	BTC	USD 16,852	+1.1% (YTD: +1.8%)

THE CLOSING BELL-

The EGX30 rose 3.25% at yesterday’s close on turnover of EGP 3.51 bn (125.7% above the 90-day average). Foreign investors were net sellers. The index is up 6.6% YTD.

In the green: Alexandria Container and Cargo Handling (+10.4%), Abu Qir Fertilizers (+9.6%) and Sidi Kerir Petrochemicals (+8.0%).

In the red: Juhayna (-3.3%), Ibnsina Pharma (-2.7%) and Madinet Nasr Housing (-1.1%).

Asian markets are in the green across the board — with the exception of Australia’s ASX200 — in early trading this morning. Futures suggest most major European and US indices, on the other hand, are set to open down later on today.