Fed Rate Cuts Couldn't Be More Timely for Economies Across Gulf - Bloomberg

Fed Rate Cuts Couldn't Be More Timely for Economies Across Gulf - Bloomberg:

While not everyone agrees that interest-rate cuts are warranted in the U.S., monetary easing by the Federal Reserve is making looser policy possible where it’s long overdue.

Gulf Arab central banks, which largely move in lockstep with the U.S. to protect their currencies’ peg to the dollar, are set to follow the Fed again if, as widely expected, it reduces rates on Wednesday for a second straight meeting. After a wallop of economic uncertainty in the wake of the attack on oil infrastructure in Saudi Arabia, monetary relief could hardly come at a better time.

“It’s a gift from the gods of the Fed,” said Marcus Chenevix, an analyst at investment research firm TS Lombard in London. “They’re suddenly allowed to loosen when the U.S. probably shouldn’t.”