In a piece of news that will bring a smile to the face of a lot of customers, the Central Bank of the UAE on Wednesday said that it was cutting interest rates applied on the issuance of certificates of deposits starting from Thursday. This is a decision following the US Federal Reserve’s decision to cut rates by 25 basis points. This is also the US central bank’s first such move after the financial crunch in 2008.
The UAE central bank said that its repo rate for borrowing short-term liquidity had also been reduced by 25 bps, starting from Thursday. What all these technical details mean is that the loans will get cheaper for the customers.
Central banks in Saudi Arabia and Bahrain followed the move, cutting their rates by the same margin.
The Saudi Arabian Monetary Authority said it had reduced its repo rate, to 275 basis points from 300 bps, and the reverse repo, by the same margin to 225 bps.
The Central bank of Bahrain decided to cut its one-week deposit facility to 2.50 percent from 2.75 percent. It also reduced the overnight deposit rate to 2.25 percent from 2.5 percent, and the lending rate to 4.25 percent from 4.5 percent (as reported by Khaleej Times).
Post Your Comments