GCC Banks Maintain Interest Rates for 7th Consecutive Period
Gulf Cooperation Council (GCC) central banks have held interest rates steady for the seventh consecutive period, aligning with the US Federal Reserve's benchmark rate of 5.25 to 5.50 percent. The Saudi Central Bank and other GCC countries have maintained their respective repo rates. US Federal Reserve Chair Jerome Powell cited a strong labor market and steady inflation towards a 2 percent target as reasons to maintain the current rate.
Gulf Cooperation Council (GCC) central banks have held interest rates steady for the seventh consecutive period, aligning with the US Federal Reserve's benchmark rate of 5.25 to 5.50 percent.
The decision is influenced by the pegging of regional currencies to the US dollar, resulting in maintained rates since July.
The Saudi Central Bank (SAMA) will keep repo rates at 6 percent.
Similarly, the UAE central bank and Qatar's central bank have set their repo rates at 5.40 percent and 6 percent, respectively, while Kuwait, Oman, and Bahrain followed suit.
Repo rates, a form of short-term borrowing involving government securities, highlight GCC's economic ties with the US.
Vijay Valecha, Chief Information Officer at Century Financial, notes that high rates are unlikely to affect Saudi Arabia's economic growth, supported by its non-oil economy and mega projects funding.
The USD's strength is also expected to keep imports cheap for Saudi Arabia.
US Federal Reserve Chair Jerome Powell cited a strong labor market and steady inflation towards a 2 percent target as reasons to maintain the current rate.
Fed projections estimate an economic growth rate of 2.1 percent and an unemployment rate of 4 percent for the year.
The decision is influenced by the pegging of regional currencies to the US dollar, resulting in maintained rates since July.
The Saudi Central Bank (SAMA) will keep repo rates at 6 percent.
Similarly, the UAE central bank and Qatar's central bank have set their repo rates at 5.40 percent and 6 percent, respectively, while Kuwait, Oman, and Bahrain followed suit.
Repo rates, a form of short-term borrowing involving government securities, highlight GCC's economic ties with the US.
Vijay Valecha, Chief Information Officer at Century Financial, notes that high rates are unlikely to affect Saudi Arabia's economic growth, supported by its non-oil economy and mega projects funding.
The USD's strength is also expected to keep imports cheap for Saudi Arabia.
US Federal Reserve Chair Jerome Powell cited a strong labor market and steady inflation towards a 2 percent target as reasons to maintain the current rate.
Fed projections estimate an economic growth rate of 2.1 percent and an unemployment rate of 4 percent for the year.
