Central bank raises main interest rates by 50 basis points

AMMAN — The Central Bank of Jordan's (CBJ) open market operations committee on Tuesday decided to increase the main interest rate of the bank and the interest on finance policy tools by 50 basis points as of Tuesday, the Jordan News Agency, Petra, reported. 

The committee's decision was taken in light of the outcome of the bank's follow-up on economic and monetary developments on the local, regional and international levels and in line with the developments in interest rates at regional and international monetary markets and their future expectations. 

The decision also aims at ensuring a boost to competitiveness of assets expressed in Jordanian dinar and preserving financial and monetary stability. 

Under the decision, the main interest rate at the CBJ stands at 3.25 per cent annually and Jordanian dinar overnight deposit rate becomes 2.25 per cent. 

The rate of one-week deposit certificates will range between 3-3.25 per cent annually, Petra reported, adding that interest rate of overnight repurchase agreements has become 4 per cent annually. 

Moreover, the interest rates of rediscount stands at 4.25 per cent. 

To ensure continuous provision of funding under proper and facilitated conditions for vital sectors, especially small and medium enterprises, the CBJ decided to maintain the interest rate for refunding programmes at its current level.

This applies to programmes directed at the industrial, tourism, agriculture, renewable energy and IT sectors, with the interest rate remaining 1.75 per cent for projects within the capital and 1 per cent for projects in other governorates, keeping the loan payback periods at 10 years. 

The bank said it will continue following up on economic developments in the local, regional and international spheres, to respond with the necessary monetary and finance decisions in order to boost monetary stability and create an environment attractive to local and foreign investments, and enabling of the national economy to achieve reasonable growth rates.