Saudi Arabia and the United Arab Emirates joined the US Federal Reserve on Tuesday and announced reducing key interest rates by 50 basis points.
The Saudi Arabian Monetary Authority said that “in light of global developments”, it was cutting its repo rate, used to lend money to banks, by 50 bps to 1.75% and its reverse repo rate, at which commercial banks deposit money with the central bank, by 50 bps to 1.25%.
For its part, the UAE central bank said that it was cutting interest rates on certificates of deposit and its repo rate for borrowing short-term liquidity by 50 bps.
The Fed announced cutting interest rates on Tuesday in a bid to shield the world’s largest economy from the impact of the coronavirus.
According to Reuters, this was Fed's first emergency cut since 2008 at the height of the financial crisis.
