Riyadh: Central banks in the Gulf Cooperation Council (GCC) has hiked the interest rates. The rates were hiked as the US Federal Reserve hiked its key interest rate. This is for the fifth time in this year that the US Federal Reserve is hiking the rates. US Federal Reserve on Wednesday increased the policy rate by 75 basis points (bps).
Most central banks in the GCC follow the US Federal Reserve’s policy rate moves because their currencies are pegged to the US dollar.
The Saudi Central Bank ( Sama) raised its repurchase agreement (repo) rate by three quarters of a percentage point to 3.75% and its reverse repo rate by a similar margin to 3.25%. The Central Bank of the UAE raised its benchmark base rate for its overnight deposit facility (ODF) by three quarters of a percentage point to 3.15%.
The Central Bank of Kuwait (CBK) also increased its discount rate by 0.25 bps to 3.00%. The Central Bank of Bahrain (CBB) increased its key rate on one-week deposits by 75 basis points to 4.00%. The Central Bank of Qatar raised its repo rate by 75 bps to 4.00%. It raised its deposit rate by three quarters of a percentage point to 3.75% and the lending rate by an equal amount to 4.50%.