UAE Business: Gulf central banks raise key rates after Fed hike – Gulf Digital News

UAE Business: Gulf central banks raise key rates after Fed hike – Gulf Digital News

The central banks of Saudi Arabia, UAE, Kuwait, Qatar and Bahrain have decided to raise their interest rates, tracking a hike in the US Fed's benchmark rate.

The move came as the US Federal Reserve raised its benchmark interest rate by 75 basis points to a range of 3%-3.25% on Wednesday - the biggest increase since 1994.

The rate increase, announced Wednesday at the end of the Fed’s two-day policy meeting, was the fifth of the year and the third consecutive three-quarter point hike. With few signs that its actions are working yet, the Fed has ramped up its moves to cool demand and keep prices from rising.

The Central Bank of the UAE (CBUAE) earlier yesterday decided to raise the Base Rate applicable to the Overnight Deposit Facility (ODF) by 75 basis points – from 2.4% to 3.15%, effective from Thursday, 22 September 2022.

The Saudi Central Bank decided to raise the rate of “repo” agreements by 75 basis points to 3.75 percent, and the rate of “reverse repo” agreements by 75 basis points to 3.25 percent, in line with the bank’s goals in maintaining monetary and financial stability in light of global developments, said a statement.

The Central Bank of Bahrain (CBB) decided