Central Bank of Yemen has approved today to reduce the base interest rate to 15%
Central Bank of Yemen
has approved today to reduce the base interest rate from 18% to 15% in the
light of the positive developments of the economic indicators in Yemen.
The Governor Mr. Mohammed Awad bin Hammam said “This decision
come out as a result of the latest developments in the economic and monetary
indicators especially the noticed decline in the inflation rate to 8.5 percent
compared to 23 percent in 2011 .
He stressed on the
positive impact of the interest rate decline; especially in supporting the
ability of the commercial banks in credit expansion; which of course will be reflected
on reducing the cost of financing the activities of the private sector, leading
to stimulate the economic growth.
He also explains how
the reduction decision will effect positively on the cost of the product and
service which contributes in the stability of the prices in the market.
He pointed out that
the real interest rate still consider high even after the current reduction if
compared to the prevailing interest rate of foreign currencies in the global
markets which is below the 1 percent .
He confirm that the
CBY will continue to monitor the economic development in the country and will
take supportive monetary policies aiming to stimulate economic growth during
the 2013, he also added that the commitments of the donor countries which
expected to be implemented in the near future; will contribute in supporting
the economic growth.
Finally; the Governor
stated that the foreign exchange reserve has increased to 6.2 billion USD
compared to 5.4 billion USD by the end of 2011.