Oman's central bank won't automatically imitate last week's interest rate hike by the US Federal Reserve, central bank executive president Hamood Sangour al-Zadjali told Reuters on Sunday.
Oman is the only member of the six-nation Gulf Cooperation Council not to announce an official interest rate rise in the wake of the Fed's 0.25 percentage point increase.
The Omani central bank will monitor interest rates offered by local banks and will not "blindly follow the Federal Reserve's decision", Zadjali said.
"Even though the Omani rial is pegged to the US dollar, the economic cycle in the US is different from the local economic cycle."
Zadjali added, "Oman has its independent policies with regards to this issue. The situation needs to be deeply and carefully studied before any decisions, keeping the national economy's interest in mind."
The central bank's overnight repurchase rate, which is determined by a formula based on the London interbank offered rate, has been edging up in the last few months from the 1.00% level where it was for years. The rate hit 1.195% last week.
Zadjali said early this month that he did not want to see Omani commercial banks' loan and deposit rates rise, but that increases might eventually become inevitable because of US monetary policy and tightening liquidity in Oman's banking system.
LEAVE A COMMENT Your email address will not be published. Required fields are marked*
Europe’s second-highest real rate is where Belarus wants it
ECB frets about looming trade war cost behind ‘facade of optimism’
India ships more cotton to China as 25% tax spoils US supply
Europe firms say business in China ‘more difficult’
Thai PTT to buy Engie’s Glow for more than $4bn
Noble wins over key shareholder in step to survival
Australia’s telecom giant Telstra to axe 8,000 jobs
QSE reopens lower after Eid holidays
Air India sale flop to swing focus to cost cuts