North Africa/Middle East

Bank of Israel Deputy Governor Andrew Abir suggested on Monday that more interest rate increases were possible as inflation remains "sticky" above a 5% rate, Reuters reported. He was speaking to Reuters the central bank raised its benchmark interest rate by a half a percentage point to 4.25%, its highest level since late 2008.

Egypt’s monthly food prices soared at the fastest pace on record, sending inflation in urban parts of the country sharply higher in January and adding to the urgency for the central bank to resume interest-rate hikes, Bloomberg News reported. The surge in cost increases was a surprise to many economists even after last month’s steep currency devaluation heaped more pressures on consumers in the Middle East’s most populous nation.

Tunisia's government on Wednesday began discussions on a new foreign exchange bill it says will help to make international business dealings easier, following calls from Tunisian firms for reform, Reuters reported. "Tunisia looks to modernise the exchange system and to gradual liberalisation of financial relations toward a full liberalisation with the outside world," the government said on Wednesday in a statement following talks on the bill. Investors have to get central bank approval to access hard currency to fund operations abroad, or obtain credit letters to import goods.

Cryptocurrency exchange Kraken has shut its Abu Dhabi office less than a year after securing a license in the region, a spokesperson said on Thursday, as the company seeks to sharpen its focus after FTX's bankruptcy shook the digital assets sector, Reuters reported. The U.S.-based company had said last year it would reduce its workforce by 30%, or about 1,100 employees, as rising rates and worries of an economic downturn soured the sentiment on crypto.

The Saudi Central Bank said on Wednesday it increased its key interest rates by 25 basis points, following the U.S. Federal Reserve's move as the Saudi riyal is pegged to the dollar, Reuters reported. The Saudi Central Bank, also known as SAMA, lifted its repo and reverse repo rates by 25 bps each to 5.25% and 4.75%, respectively, it said in a statement. Read more.

The central bank of Kuwait raised its discount rate to 4% from 3.50% effective Jan. 26, it said in a statement on Wednesday, Reuters reported. The decision is in line with "recent developments in the local and international economic conditions, local monitory and banking indicators and movements on KWD interest rate in the local market considering changes to the interest rates on the other major currencies," Governor Basel Al-Haroon said in the statement. Read more.

A voting member of the Bank of Israel’s monetary committee stepped down and warned that “democracy is in danger” in his country, marking one of the highest-profile departures since Prime Minister Benjamin Netanyahu began his push to reform the judicial system, Bloomberg News reported. Moshe Hazan, an economics professor who spent more than five years on the rate-setting panel, sent Netanyahu a resignation letter late Sunday, saying he was leaving to become more involved in “public-political activity,” according to a statement from the central bank.

Iraqi Prime Minister Mohammed al-Sudani has dismissed the country’s central bank governor amid growing anger over the weakening of the local currency in recent weeks that has caused the price of food and imports to rise, the Wall Street Journal reported. Mr. Sudani said on Monday that he decided to replace the governor, Mustafa Ghaleb Mukheef, who requested to be relieved of the post he has held since 2020. The prime minister named Muhsen al-Allaq as the new central bank governor, according to the state-backed Iraqi News Agency. Mr.

Lebanon’s caretaker government Wednesday approved opening credit lines totaling $116 million to help fix its crippled state electricity grid, the Associated Press reported. The cash-strapped country for over two years has struggled with rampant power cuts that have crippled much of public life, worsening a broader economic crisis that has pulled over three-quarters of the country’s population into poverty. Today, households only receive about an hour of state electricity per day, with millions now relying on expensive private generator suppliers to power their homes.

Egypt plans to cut spending after the International Monetary Fund extended hundreds of millions of dollars in an economic bailout package, as the country struggles to pay off debts accumulated from a decadeslong building boom, the Wall Street Journal reported. Authorities said earlier this week they would delay state projects that required significant U.S. dollars to fund and cut back on travel, training and conferences for officials, according to Egypt’s cabinet.