Central Bank of Kuwait keeps interest rate steady at 3.75% despite U.S. Fed cut
. . . reaffirms commitment to closely monitor both global and domestic developments and to employ its monetary policy tools “in a gradual and balanced manner” to preserve monetary and financial stability.
The Central Bank of Kuwait (CBK) announced that it will maintain its discount rate at 3.75%, choosing not to follow the U.S. Federal Reserve’s latest decision to reduce interest rates by 25 basis points.
In a statement, the CBK said its decision reflects ongoing monitoring of key economic and monetary indicators, as well as geopolitical developments and their impact on both global and local economies.
The bank noted that current data demonstrate the strength and stability of Kuwait’s monetary and financial system, confirming that its policy remains consistent with local economic conditions, reports Al-Rai daily.
According to the latest figures, the broad money supply (M2) rose by 1.7 billion dinars, or 4.1% year-on-year, in September 2025. Residents’ deposits in local banks increased by 1.4 billion dinars (2.7%), while credit facilities for residents grew by 3.5 billion dinars, marking a 7.2% increase compared to the same month in 2024.
The CBK reaffirmed its commitment to closely monitor both global and domestic developments and to employ its monetary policy tools “in a gradual and balanced manner” to preserve monetary and financial stability.
The move comes shortly after the U.S. Federal Reserve announced its second rate cut of the year, lowering the target range to 3.75%–4% from the previous 4%–4.25%. The Fed cited continued uncertainty about the economic outlook, moderate growth, and a slight rise in unemployment, while inflation remains above target.
Across the Gulf region, several central banks mirrored the Fed’s decision. The UAE Central Bank cut its base rate on overnight deposit facilities by 25 basis points to 3.9%, while the Central Bank of Bahrain reduced its overnight deposit rate to 4.5%. Similarly, the Qatar Central Bank and the Central Bank of Oman also lowered key rates by 25 basis points.
By maintaining its current rate, the Central Bank of Kuwait signaled confidence in the resilience of the national economy and reaffirmed its independent approach in aligning monetary policy with domestic financial conditions rather than external trends.
