Gulf banks raise interest rates, following US Federal Reserve
Gulf states often follow the American central bank in their interest rate decisions.
Several central banks in the Gulf raised interest rates Wednesday.
What happened: The Central Bank of the United Arab Emirates raised its base rate for its overnight deposit facility from 2.4% to 3.15%. This is the rate at which banks loan to other banks after normal business hours.
The Saudi Central Bank raised its repo rate from 3 to 3.75% and its reverse repo rate from 2.5% to 3.25%. The repo rate is the interest rate on central bank purchases of securities, e.g. bonds from commercial banks. The reverse repo rate is the rate at which the central bank borrows from commercial banks.
The Qatar Central Bank raised its deposit rate from 3% to 3.75%, its lending rate from 3.75% to 4.5% and its repo rate from 3.25% to 4%.
