Tuesday, the Saudi Arabian Monetary Agency or SAMA lowered its reverse repo rate by 25 basis points to 0.5% with immediate effect.
This measure has been taken in view of the easing of inflationary pressures in the domestic economy and the existence of adequate liquidity of the banking system, which calls for the return of balance between the rate of return on the opposite of repurchase agreements and short-term interest rates, the SAMA said.
The central bank kept the benchmark repurchase rate unchanged at 2 percent. The reverse repurchase rate is the rate at which SAMA borrows money from the commercial banks.
In January, the central bank had reduced the reverse repo rate to 0.75% from 1.50%.
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