The Saudi Central Bank said on Wednesday it increased its key interest rates by 75 basis points, following the US Federal Reserve’s move as the Saudi riyal is pegged to the dollar.
The Saudi Central Bank, also known as SAMA, lifted its repo and reverse repo rates by 75 bps to 4.5% and 4%, respectively, it said in a statement.
The move by the Saudi Arabia was reflected by banks across the GCC as central banks raised benchmark rates to maintain their currency’s pegs to the US dollar.
The Central Bank of the UAE (CBUAE) has increased the Base Rate from 3.15% to 3.90%, effective immediately. CBUAE also decided to maintain the rate applicable to borrowing short-term liquidity from the CBUAE through all standing credit facilities at 50 basis points above the Base Rate.
Meanwhile, the Central Bank of Bahrain (CBB) said it raised its key policy interest rate on its one-week deposit facility by 75 basis points to 4.75%, following the U.S. Federal Reserve’s fourth straight hike of that size as the Bahraini dinar is pegged to the dollar.
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