Riyadh: The Saudi Central Bank (SAMA) has decided to raise the Repurchase Agreement (Repo) rate by 25 basis points to 4.50 percent, and to raise the Reverse Repurchase Agreement (Reverse Repo) rate by 25 basis points to 4.00 percent. This decision is in line with SAMA's mandate of preserving monetary stability.

According to Saudi Press Agency, the adjustment in the Repo and Reverse Repo rates is aimed at maintaining economic equilibrium. SAMA's decision reflects its continuous efforts to manage liquidity levels and ensure the stability of the financial system in Saudi Arabia. The increase in rates is part of the broader strategy to address inflationary pressures and encourage sustainable economic growth.

The Repo rate is a tool used by SAMA to control short-term borrowing by commercial banks, impacting the overall liquidity in the banking sector. The Reverse Repo rate, on the other hand, influences the rate at which banks can deposit funds with the Central Bank. These adjustments are crucial in steering the monetary policy and managing the economic indicators effectively.