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05 March 2020

Central Bank of Kuwait cuts discount rate to 2.5 per cent

Saudi Arabia, the UAE and other Gulf states also reduced key interest rates tracking an emergency move by the Fed to soften the impact of the coronavirus outbreak

The strength of Kuwait banking sector has been bolstered by prudent regulatory policies implemented by through micro and macro-prudential instruments/iStock

by Kudakwashe Muzoriwa

The Central Bank of Kuwait’s (CBK) Board of Directors has reduced the discount rate by 0.25 percentage points from 2.75 per cent to 2.50 per cent following an emergency move by the US Federal Reserve in response to the impact of the coronavirus outbreak.

CBK stated that in light of the uncertainty of global economic growth prospects and the negative impact of the coronavirus outbreak on global economic activity, the regulator’s board has decided to reduce the discount rate by a quarter percentage point.

HE Dr. Mohammad Y. Al-Hashel, the Governor, of CBK, said that the decision is part of the central bank’s efforts to maintain monetary and financial stability by fostering an atmosphere conducive to sustainable economic growth and ensuring the continued attractiveness and competitiveness of the national currency.

Across the region, the Central Bank of Jordan (CBJ) also said that it was cutting its main interest rates by 50 basis points to encourage local consumption and the investment needed to spur economic growth.

CBJ stated that in order to sustain economic activities, it has also decided to maintain the interest rates on its refinancing programme, which targets SMEs projects, unchanged at 1.75 per cent for projects located in Amman governorate and 1.00 per cent for projects located in otherwise governorates.


RELATED STORIES: Central Bank of Kuwait US Federal Reserve Central Bank of Jordan coronavirus Saudi Arabia UAE





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