DUBAI: Most stock markets in the Gulf ended lower on Sunday pressured by lingering doubts over whether the US Federal Reserve will deliver an additional interest rate cut before the end of the year.
Federal Reserve Bank of Cleveland President Beth Hammack said on Friday she had opposed the central bank’s interest rate cut last week, adding that the Fed needs to maintain some restriction to bring down inflation.
The Fed cut interest rates on Wednesday, but hawkish remarks from Chair Jerome Powell mean markets are now pricing a 63 percent chance for a 25-basis-point cut at the December meeting, down from almost 92 percent a week ago, according to the CME’s FedWatch Tool.
US monetary policy shifts have a significant impact on Gulf markets, where most currencies are pegged to the dollar.
Saudi Arabia’s benchmark index declined 1 percent, dragged down by a 2.5 percent fall in Al Rajhi Bank and a 1 percent retreat in oil behemoth Saudi Aramco.
In Qatar, the index fell 0.2 percent, hit by a 0.5 percent fall in petrochemical maker Industries Qatar and a 0.3 percent decrease in Qatar Islamic Bank.
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