AMMAN —
The Central Bank of Jordan’s (CBJ) decision to raise interest rates by 75 basis
points on all monetary instruments took effect on Monday, as it fixed
preferential interest rates for the bank’s program to refinance 10 vital
economic sectors, Al-Ghad daily reported.
اضافة اعلان
This is the fifth
hike since the end of last year; the first was 25 basis points, the second was
50 basis points, while the third, fourth and fifth hikes were each 75 basis
points.
According to CBJ,
the decision is in line with its goal of maintaining monetary stability in the
Kingdom, and with the bank’s commitment to maintain the attractiveness of the
Jordanian Dinar as a savings currency, in light of fluctuations in global
financial markets and interest rates.
The bank is
working to counter the growing inflation, which amounts to about 5.7 percent,
and indicated that this latest decision was taken in light of the persistence
and expansion of external inflationary pressures, their impact on domestic
inflation rates, and the uncertainty generated by the effects of the
Russian-Ukrainian war and geopolitical risks.
Banking sources
said that the decision aims mainly to maintain the attractiveness of the dinar,
especially since the central banks of other countries have also raised the
interest rate, including the Gulf Cooperation Council countries.
Bank deposits have
increased by JD1.7 billion, bringing their balance to JD41.2 billion at the end
of July, while credit facilities granted by banks increased by JD1.9 billion
during the same period, reaching JD31.9 billion.
Sources pointed
out that the CBJ maintains its monetary policies to ease interest rates on a
number of economic sectors in order to boost economic growth.
The bank announced
that it will continue to keep the preferential interest rates for its program
fixed, to refinance the 10 vital economic sectors, at a value of JD1.3 billion,
at 1 percent for beneficiary projects within the Amman governorate, and at 0.5
percent for projects in the rest of the governorates. These rates will remain
stable throughout the term of the loan, which is 10 years.
The CBJ’s program
to support small- and medium-size companies, professionals, craftsmen and
importers of basic commodities in the wholesale sector, which amounts to JD700
million, has been extended until the end of this year.
The interest rate
for borrowers in this program will remain at its current level, not exceeding 2
percent, and for 54 months, including a grace period of up to 12 months from
the date the funding was granted. Financing under this program is also granted
at a fixed interest rate for the duration of the loan.
The bank, through
these two programs, has financed about 7,825 projects, at a value of some
JD1,824.9 million, and contributed to creating about 14,517 job opportunities,
in addition to maintaining about 151,000 jobs since the start of the corona
pandemic. The amount of funding available under the two programs is about
JD690.5 million.
Data for the
current year indicates that foreign reserves at the CBJ amounted to $16.8
billion, sufficient to cover 8.7 months of the Kingdom’s imports of goods and
services, nearly three times the internationally recognized rate of three
months.
Many economic
indicators showed positive performance so far this year, especially the tourism
sector, whose income rose during the first eight months of this year to $3.6
billion, compared to $1.4 billion during the same period last year; a growth
rate of more than 161 percent.
Data also showed
that Jordanians’ remittances grew by 0.8 percent during the first seven months
of this year, and that exports grew by 43.4 percent during the first half of
the year.
Read more Business
Jordan News
.jpg)
.jpg)
