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The US Federal Reserve on Wednesday raised interest rates by half a percentage point (50 bps) at its final gathering of the year.
Following the Fed's move, the UAE and GCC central banks matched the 0.5% rate hike.
The Central Bank of Bahrain (CBB) was the first to announce the rate hike in the region.
Its key policy interest rate on the one-week deposit facility is raised from 4.75% to 5.25%. The CBB has also decided to raise the overnight deposit rate from 4.50% to 5.00%.
The Central Bank of the UAE (CBUAE) decided to raise the Base Rate applicable to the Overnight Deposit Facility (ODF) by 50 basis points, from 3.9% to 4.4%, effective from Thursday, 15 December 2022.
The CBUAE also has decided to maintain the rate applicable to borrowing short-term liquidity from the CBUAE through all standing credit facilities at 50 basis points above the Base Rate, it said in a statement.
The Qatar Central Bank has also decided to increase interest rates by 50 bps.
The Saudi Central Bank has also raised the rate of Repurchase Agreement (Repo) by 50 basis points to 5% and the rate of Reverse Repurchase Agreement (Reverse Repo) by 50 basis points to 4.50% .
(Writing by Seban Scaria; editing by Anoop Menon)
