Ammon News - The open market operations committee at the Central Bank of Jordan (CBJ) on Thursday decided to increase the interest rate on its various monetary policy instruments by 50 basis points, effective next Sunday, June 19.

Meanwhile, the committee decided to raise the Overnight Deposit Facility (ODF) interest rate by 75 basis points, also effective on the same date.

This decision comes in light of the CBJ's "firm" commitment to strengthening the foundations of the Kingdom's monetary stability, maintaining attractiveness of the Jordanian dinar as a savings tool, and enhancing deposits that constitute a major pillar for providing the funding needs of the national economy, according to a CBJ statement.

In addition, the decision comes in light of the growing external inflationary pressures and the resulting rise in interest rates prevailing in the international and regional financial markets.

It also aims to direct banks’ borrowing costs in the money market to remain within acceptable levels and enable them to maintain efficiency of liquidity management and credit market activity and its efficacy, the statement added.

Within the framework of the CBJ keenness to provide financing on preferential and concessional terms for the vital economic sectors, as well as for small and medium-sized companies, the committee also decided to extend the bank’s refinancing programme, worth JD1.3 billion, that targets 10 vital economic sectors, by maintaining the fixed preferential interest rate at 1.0% for projects within the capital Amman and 0.5% for enterprises in the remaining governorates for a 10-year period.