Saudi Arabia's Central Bank Aligns with Fed's Rate Cut
Saudi Arabia's central bank reduced both the repo and reverse repo rates by 25 basis points, aligning with the U.S. Federal Reserve's recent rate cut. This adjustment brings the repo rate to 4.50% and the reverse repo rate to 4.00%, reflecting a coordinated monetary policy approach due to the currency peg to the U.S. dollar.
Saudi Arabia's central bank announced on Wednesday a 25 basis point reduction in its repo rate, bringing it down to 4.50%. Similarly, the reverse repo rate was trimmed by 25 basis points to 4.00%.
This move aligns the Kingdom's monetary policy with the U.S. Federal Reserve, which recently lowered its interest rates by a quarter of a percentage point.
The adjustments underscore the dependency of Saudi Arabia, due to its currency being pegged to the U.S. dollar, on the American central bank's fiscal changes.
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