RIYADH: The Saudi Central Bank on Wednesday raised key interest rates in line with domestic and global developments and to maintain monetary and financial stability, said an official statement issued on Wednesday.
The central bank, also known as SAMA, has decided to raise the repurchase agreement (repo) rate by 0.5 percent to 2.25 percent from a previous 1.75 percent, and the reverse repurchase agreement (reverse repo) rate by 0.5 percent to 1.75 percent from a previous 1.25 percent.
The increase followed the hike in the US Federal Reserve benchmark rate on the same day.
The US central bank raised the benchmark borrowing rate by 0.75 percentage points, bigger than the telegraphed 0.5-percentage-point increase after economic data in recent days showed inflation strengthening and consumer confidence weakening.
Federal Reserve Chair Jerome Powell said the Fed has the “tools” and the “resolve” to do what it takes to lower inflation from the highest level in more than 40 years, adding that the central bank could hike the benchmark interest rate by another 0.75 percentage points in July.