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Central Bank of Kuwait announces 3 percent discount
The Central Bank of Kuwait on Wednesday cut its discount rate by 50 basis points to 3 percent, in its second such reduction during the month.
The Central Bank said the reduction, the fifth such reduction since October, will be implemented from Thursday.
The Central Bank Governor, Sheikh Salem Abdulaziz al-Sabah, said that this latest discount would help in boosting the growth of non-oil sectors of the domestic economy by reducing the cost of lending, following indications that inflationary pressures have declined.
The measure is another step in the right direction by the central bank to further strengthen confidence in national economy by increasing demand and thereby boosting growth in non-oil sector.
Several Kuwaiti economic sectors, particularly investment firms have been hit hard by the fallout of global economic crisis and the top two investment firms have defaulted on their debts.
Last month, the oil-rich Gulf State approved a multi-billion-dollar stimulus package to encourage banks to offer new loans and help troubled investment firms.
The drop in interest rates will enable cheaper borrowing and encourage troubled investment companies in seeking fresh loans to refinance their debts.
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