SAMA, other Gulf central banks cut
rates as region battles coronavirus
March 16, 2020
Kuwaiti traders wearing protective masks follow the market at the Boursa Kuwait stock exchange in Kuwait City in this March 1, 2020 file picture. — Courtesy photo
RIYADH — The Saudi Arabian Monetary Authority (SAMA) has decided to cut repo rate by 75 basis points from 1.75 percent to 1.00 percent and the reverse repo rate by 75 basis points from 1.25 percent to 0.50 percent, Saudi Press Agency reported on Monday.
The reduction in repo rates is for preserving monetary stability given evolving global developments, the SPA report added.
Meanwhile, a day after the US Federal Reserve slashed its rates to near zero in an effort to ease the impact of the coronavirus outbreak, other Gulf central banks followed suit on Monday.
The UAE central bank slashed its interest rate on one-week certificates of deposit by 75 basis points and other rates by 50 bps while Kuwait's central bank cut its deposit rate by 100 bps to 1.5 percent, its lowest ever. It also cut its overnight, one-week and one-month repo rates by 100 bps to 1 percent, 1.25 percent, and 1.75 percent respectively, Reuters reported on Monday.
Bahrain also Bahrain's central bank (CBB) cut overnight, weekly and monthly deposit rates, in addition to its lending rate
“The CBB’s key policy interest rate on the one-week deposit facility is cut from 1.75 percent to 1.00 percent. The CBB has also decided to cut the overnight deposit rate from 1.50 percent to 0.75 percent, the one-month deposit rate from 2.20 percent to 1.45 percent, and the CBB lending rate from 2.45 percent to 1.70 percent, the central bank said in a statement.
“The adjustment to interest rates represents part of the CBB’s efforts and continuous measures to ensure monetary and financial stability, as well as maintaining the smooth functioning of the money markets and economic activity in Bahrain,” the statement added.
The Qatari regulator also slashed its deposits, lending, and repo rates.
