CBJ raises interest rate on monetary policy instruments by 75 basis points

(File photo: Ameer Khalifeh/Jordan News)
AMMAN — The Central Bank of Jordan (CBJ) on Thursday decided to increase the interest rate on its various monetary policy instruments by 75 basis points, effective Sunday, July 31, according to the Jordan News Agency, Petra.اضافة اعلان

This decision comes in light of the “growing” external inflationary pressures and the resulting hike in interest rates in the global financial markets, the CBJ said in a statement.

The step also reflects the CBJ’s commitment to strengthening the foundations of Jordan’s monetary stability and maintaining the attractiveness of the Jordanian dinar as a savings tool, the statement added.

In the context of the CBJ’s keenness to provide financing on preferential and concessional terms for vital economic sectors, the committee decided to maintain the fixed preferential interest rate for the loan duration for the bank’s program to refinance vital economic sectors, amounting to JB1.3 billion, unchanged at 1.0 percent for projects located in Amman governorate and 0.5% for projects in the remaining regions for ten years.

In addition, the committee decided to keep the interest rate for borrowers from the CBJ’s program to support SMEs, craftspeople, and importers of the wholesale sector of essential commodities, amounting to JD700 million, unchanged and not exceeding 2%, for 54- month period, including a 12-month grace period from the date of disbursing the funding.

To date, CBJ’s volume of foreign reserves stands at $16.7 billion, enough to cover the Kingdom’s imports of goods and services for up to 8.7 months.

Jordanian banks deposits continued their high growth until May of 2022 on an annual basis, at a rate of 7.5%, while credit facilities granted by banks recorded an annual growth of 5.8% until May 2022.

Meanwhile, Jordan’s tourism revenues jumped by 242.7 percent during the first six months of 2022, compared with the same period of 2021, while national exports increased by 43.4 percent during the first five months of 2022.

Remittances of Jordanians working abroad in the first five months of 2022 went up by 2.9 percent when the inflation rate stood at 3.3 percent in the first half of 2022.

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