Skip to content Skip to Search
Skip navigation

Gulf central banks mirror US Fed by halting rate hike

City, Urban, Downtown Wam
The UAE's overnight deposit facility will remain unchanged at 5.40 percent as of September 21, 2023

The Central Bank of the UAE and Qatar Central Bank have decided to maintain interest rates after the US Federal Reserve board announced it will keep the key borrowing rates unchanged.

The UAE’s central bank will hold the base rate applicable to the overnight deposit facility steady at 5.15 percent as of Thursday 15 June, the UAE state-run Wam news agency reported.

In addition it decided to maintain the rate applicable to borrowing short-term liquidity from the apex bank through all standing credit facilities at 50 basis points above the base rate.

Qatar Central Bank announced that it will also continue with the current interest rates for deposits at 5.50 percent, with lending at 6 percent and repo at 5.75 percent.

The Fed left key interest rates in a target range of 5-5.25 percent, describing the US growth and the job market as holding up better than expected in spite of aggressive monetary policy tightening.

However, BofA Global Research expects two more quarter percentage point interest rate hikes from the Fed this year, taking its terminal rate forecast to 5.5 percent to 5.75 percent.

The base rate, anchored to the Fed’s rates, provides an effective interest rate floor for overnight money market rates in the UAE.

The other Gulf central banks have yet to announce whether they will be changing their rates.

Latest articles

A solar plant in Uyayna, north of Riyadh. Solar power will contribute to Saudi Arabia's 2030 renewable goal

Renewables target for 2030 in sight for Saudi Arabia

Saudi Arabia will expand its renewable energy output sixfold by 2030 if it continues at its current pace, a survey found this week. But it will need to add 20GW of capacity annually if it is to reach an ambitious government target laid out last year. In December the government set a new target of […]

Saudi Arabia’s GDP in 2025 should rise 6 percent, the IMF has predicted

IMF cuts Saudi GDP growth prediction

The International Monetary Fund (IMF) has cut its estimate for Saudi economic growth in 2024 to 2.6 percent in its most recent World Economic Outlook, but raised its expectation for 2025.  The IMF’s April report says it’s GDP estimate is down from the 2.7 percent in predicted in January. However, the it said that Saudi […]

reducing inflation Egypt Mohamed Maait finance minister

Reducing inflation is Egypt’s top priority, says minister

Reducing inflation in Egypt to align with the central bank’s target is the government’s main priority, the country’s finance minister, Mohamed Maait, has announced. Inflation in Egypt fell to 33 percent in March from 38 percent in September, passing the central bank’s target range of a 5 to 9 percentage point fall. Maait, speaking at […]

The Khazna facility will raise utility Ewec’s total installed solar PV capacity to 5.5 gigawatts

Developers sought for Abu Dhabi’s Khazna solar plant

Emirates Water and Electricity Company (Ewec) is seeking developers to build a 1,500 megawatt solar power facility in Abu Dhabi as the emirate ramps up its green energy drive. The utility has issued a request for proposals to qualified companies that have expressed interest in developing the Khazna Solar Photovoltaic project. A total of 27 […]