Middle East Economic Survey

VOL. L

No 8

19-Feb-2007

SAUDI ARABIA

Saudi Arabias Interest Rate Hike Long Overdue, Says Riyad Bank

The Saudi Arabian Monetary Authoritys (SAMA) 30 bps interest rate hike to 5.50% on 8 February was long overdue and restores a 25 bps premium to US rates that had previously been maintained, said Riyad Banks Chief Economist Khan Zahid. The increase was likely aimed at preventing capital outflow which could have resulted from the arbitrage opportunities presented by...