Gulf central banks raise key rates

CAIRO/DUBAI, July 27 (Reuters): Most Gulf central banks increased their key interest rates on Wednesday after the Federal Reserve raised rates by an expected quarter of a percentage point, citing still-elevated inflation as a rationale for the latest hike.

The Fed raised its rate by 25 basis points (bps) on Wednesday and left the door open to another increase.

Oil and gas exporters in the Gulf tend to follow the Fed's lead on rate moves as most regional currencies are pegged to the US dollar; only the Kuwaiti dinar is pegged to a basket of currencies, which includes the dollar.

However, regional economies have been largely shielded from stubbornly

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