After US and UAE, Gulf central banks hike interest rates

The central banks of Saudi Arabia, Kuwait, Qatar, and Bahrain have decided to raise their interest rates, tracking a hike in the US Fed's benchmark rate on Wednesday.

The move came as the US Federal Reserve raised its benchmark interest rate by three-quarters of a percentage point to a range of 3.00%-3.25% on Wednesday- the biggest increase since 1994.

The Central Bank of the UAE (CBUAE) earlier on September 21 decided to raise the Base Rate applicable to the Overnight Deposit Facility (ODF) by 75 basis points – from 2.4% to 3.15%, effective from Thursday, September 22, 2022.

The rate increase, announced Wednesday at the end of the Fed’s two-day policy meeting, was the fifth of the year and the third consecutive three-quarter point hike. With few signs that its actions are working yet, the Fed has ramped up its moves to cool demand and keep prices from rising.

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