Santhosh V. Perumal
The Qatar Central Bank had last week decided to maintain the current interest rates for deposits, lending, and repo rates, following an assessment of the current monetary policy of the country.
The Gulf central banks are likely to cut rates from December, which ought to support lending, consumer spending, and private investment, thus feeding into non-energy growth, according to Oxford Economics.
Highlighting that the Gulf Co-operation Council (GCC) banks kept the interest rates on hold this week, in line with the US Federal Reserve; Oxford Economics said it still sees rates being cut this year, likely from December and through 2026.
“In the GCC, these cuts should support lending, consumer spending, and private investment, feeding into our constructive outlook for regional non-energy growth, which we see remaining above 4% next year,” it said in a latest report.
Ernst and Young had said in a report that interest rate cuts, together with further investment and structural reform initiatives, would translate as non-oil growth of more than 3.4% in the (Gulf) region’s two largest economies – Saudi Arabia and the UAE.
The Qatar Central Bank had last week decided to maintain the current interest rates for deposits, lending, and repo rates, following an assessment of the current monetary policy of the country.
The deposit rate has been maintained at 4.60%, lending rate at 5.10% and repo rate at 4.85%.
S&P Global Ratings analysts said in an outlook report had said loan growth is slated to remain strong for the remainder of the year in Qatar, Saudi Arabia and the UAE as the countries are expected to reduce their interest rates in step with the US Fed, which is expected to cut rates in the second half.
According to Oxford Economics projection, the GCC inflation is expected to be 0.4% in 2025 compared to the GCC average of 2.1%.
Kamco Invest, a regional non-banking finance entity, had in its report said despite the heightened geopolitical instability in Q2-2025, driven by the geopolitical tensions in Middle East and the ongoing war on Gaza, the inflation rate across the GCC region “remained stable” throughout the period.
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