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Saudi Arabia, Qatar, Bahrain raise interest rates, mirroring Federal Reserve

The US Federal Reserve raised rates by 0.25% on Wednesday, despite concerns about the effect on the global financial climate.
Saudi central bank

The central banks of Saudi Arabia, Qatar and Bahrain raised their key policy rates by 0.25% on Wednesday. 

The move followed the US Federal Reserve raising interest rates by the same percentage earlier in the day as it continues to fight inflation. 

Oman's central bank raised its rate by 0.25% later on Wednesday, while the United Arab Emirates did the same the following day on Thursday. Kuwait did not appear to announce a decision. 

Why it matters: The Federal Reserve has been aggressively raising rates since last year in response to inflation. But the rate hikes are controversial due to the pressure they put on the financial system by making borrowing more expensive. The failure of Silicon Valley Bank earlier this month was in part due to investors becoming more risk-averse in response to the rising rates. 

Adding to global financial concerns, the Swiss investment giant Credit Suisse was bought out by competitor UBS on Sunday. 

Know more: Gulf central banks tend to mirror the US Federal Reserve's interest rates decision. Saudi Arabia, Bahrain, Oman and the United Arab Emirates raised rates in February following the Fed, though Qatar notably decided not to. Kuwait has more often acted independently on interest rates in recent years. 

Editor's note: this article was updated to include information from the central banks of Oman and the UAE. 

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