Several Gulf central banks announced on Wednesday that they are lowering interest rates, following the US Federal Reserve’s decision to reduce rates by a quarter of a percentage point for the third time this year.
The Saudi Central Bank confirmed a cut in its repurchase agreement (repo) rate by 25 basis points to 4.25 percent and a similar reduction in the reverse repurchase (reverse repo) rate to 3.75 percent.
Qatar’s central bank also trimmed its deposit interest rate by 25 basis points to 3.85 percent, lending rates to 4.35 percent, and the repurchase rate to 4.10 percent, according to an official post on its social media platform, reports Al-Rai daily.
Meanwhile, the Central Bank of the UAE announced a 25-basis-point reduction in the base rate on overnight deposit facilities from 3.90 percent to 3.65 percent, effective Thursday, December 11.
The Central Bank of Bahrain likewise cut its overnight deposit rate by 25 basis points to 4.25 percent, starting Thursday.
Earlier, the US Federal Reserve announced a 0.25 percentage point reduction, bringing its benchmark rate to a range of 3.5–3.75 percent, prompting the coordinated moves by the Gulf central banks.
Analysts say these adjustments aim to align regional monetary policy with global trends, encourage investment, and support economic growth amid changing financial conditions.
The rate cuts are expected to influence lending costs, mortgage rates, and savings yields across the Gulf, offering relief to borrowers while maintaining central banks’ commitment to financial stability.
Economic experts note that following the Fed’s lead ensures consistency with international monetary policy, mitigating potential market disruptions from sudden rate mismatches.
The coordinated decisions reflect the Gulf region’s proactive approach to monetary policy management in a global context marked by fluctuating interest rates and economic uncertainties.
