Saudi cuts reverse repo, leaves lending rate steady

Published Wednesday, March 19, 2008

By Agencies

Saudi Arabia, which pegs its riyal to the dollar, lowered its reverse repurchase rate by 75 basis points on Wednesday after a US cut, two bankers said. It left its benchmark lending rate unchanged at 5.5 per cent.

The Saudi Arabian Monetary Agency (SAMA) cut the reverse repo to 2.25 per cent from 3 per cent, a banker in each of Riyadh and Dubai said, reading from a central bank notice.

The central bank of the world's largest oil exporter usually only communicates interest rate decisions to banks, sometimes confirming in a public statement at the end of the month.

The Fed cut its benchmark lending rate by 0.75 of a percentage point on Tuesday, its sixth cut since September, as part of an effort to ease a slowdown in an economy hit by a housing slump and credit crunch. (Reuters)

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