CBJ raises interest rate by 25 basis points following int’l changes

AMMAN — The Central Bank of Jordan (CBJ) on Sunday increased the interest rate on all monetary policy instruments by 25 basis points, effective as of Monday.

The bank said the decision was taken in line with interest rate changes in international and regional markets, the Jordan News Agency, Petra, reported, citing a CBJ statement. 

The move also aims at enhancing monetary and banking stability and ensuring a stronger competitiveness of financial instruments, according to the statement. 

However, the CBJ, in a customary decision, decided to maintain interest rate as is for entrepreneurs who borrow under a programme to boost the economy through financing SMEs in a set of designated sectors. 

The current interest rate level under the programme is 1.75 per cent for projects in Amman and 1 per cent for those started in governorates. 

CBJ has financed some 900 projects with a total value of JD600 million under the soft financing programme, to which a sum of JD1.2 billion is allocated. 

These schemes have contributed to providing more than 9,500 jobs across the Kingdom, according to the CBJ.

The bank in October decided to expand the programme to include the health sector, transportation (transport companies) and education (technical and vocational training). The scheme also covers the industry, tourism, agriculture, renewable energy, information technology and engineering consultancy fields. 

The expansion was aimed at contributing to national efforts to train and improve manpower in order to compete at the level demanded by local and international markets.

The CBJ said that it would continue to follow up closely on local and international economic developments and take proper procedures that guarantee enhanced monetary and financial stability in the Kingdom.

In August, the CBJ allowed banks operating in the Kingdom to reschedule retail loans so that the repayment period extends to 10 years from the date of granting or scheduling the loan, instead of eight.