Gulf banks raise interest rates following US Federal Reserve hike

Gulf banks raise interest rates following US Federal Reserve hike

ABU DHABI, 22nd March, 2023 (WAM) -- The central banks of Saudi Arabia, Bahrain and Qatar raised their benchmark borrowing rates after the US Federal Reserve raised its key interest rate by 25 basis points tonight.

The Saudi Central Bank raised the rate of Repurchase Agreement (Repo) by 25 basis points to 5.50 percent, and the rate of Reverse Repurchase Agreement (Reverse Repo) by 25 basis points to 5.00 percent.

In Bahrain, the one-week deposit facility rate increased to 5.75% from 5.5% and the overnight deposit rate was raised to 5.5% from 5.25%, Bahrain's Central Bank tweeted.

The Central Bank of Qatar likewise raised its interest rates by 25 basis points effective on Thursday, hiking deposit, lending and repo rates by 25 bps to 5.25%, 5.75% and 5.5%, respectively.

Earlier, the Central Bank of the UAE raised the base rate applicable to the Overnight Deposit Facility (ODF) by 25 basis points – from 4.65% to 4.90%, effective from Thursday, 23 March 2023.