Kuwait cuts discount rate by half a percent
The Central Bank of Kuwait (CBK) cut its discount rate by half a percentage point to 5.75 percent, on Wednesday March 21, reported the Kuwaiti news agency KUNA. This is the third such cut this year—which came following the US Fed interest rate cut earlier this week.
"This decision comes within CBK's ongoing follow-up of local and international economic and monetary developments," the bank's governor Sheikh Salem Abdul Aziz al-Sabah told KUNA.
Indicators such as a steady rise in cash deposits at local banks, showed favorable factors to cut domestic interest rates, the govenor added. "Another factor was the tendency of interest rates on major world currencies to go lower."
The US Federal Reserve on Tuesday cut interest rate by a half percentage point to avoid a further drops in the American financial markets and boost investor confidence.
Kuwait’s currency is pegged to a basket of currencies primarily made up of the US dollar. A discount rate cut already took place both in January and February of this year, by a half percentage point each time.
The latest cut is likely to further boost trading at the Kuwait Stock Exchange, which has recently seen an influx of funds and increased trading volumes as a result of rising investor confidence. — (Albawaba-MEBG)
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