Saudi Arabia is wrestling down money rates, central bank says | Reuters

Saudi Arabia is wrestling down money rates, central bank says | Reuters:
"Saudi Arabia's central bank is succeeding in wrestling down market interest rates and expects to see further declines as it fights a liquidity squeeze caused by low oil prices, top officials said on Monday.

Shrunken flows of petrodollars through the banking system have sent interbank money rates SAIBOR= soaring to seven-year highs this year, making it more expensive for companies to raise money and contributing to a sharp slowdown in the economy.

But central bank Governor Ahmed al-Kholifey said a modest pull-back of rates in the past three weeks, with the three-month Saudi interbank offered rate SASAR3MD= falling to 2.189 percent from 2.386 percent, showed authorities had the situation under control. The rate was below 0.80 percent in August 2015."

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