Muscat – According to recent data, this growth was primarily driven by a 23.9 percent increase in narrow money and an 8.3 percent rise in quasi-money. Quasi-money, which includes total savings, time deposits in Omani riyals, certificates of deposit issued by banks, as well as margin accounts and foreign currency deposits, played a key role in the overall expansion of the money supply.
Despite the increase in the broader money supply, cash held by the public saw a decline of 3.6 percent. However, demand deposits surged by 31.7 percent, reflecting a notable shift in public banking behavior.
Regarding the interest rate environment, the weighted average interest rate on Omani riyal deposits rose from 2.409 percent in August 2023 to 2.704 percent in August 2024. Meanwhile, the weighted average interest rate on loans in Omani riyals increased from 5.444 percent to 5.603 percent during the same period.
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In the interbank lending market, average interest rates for one-night loans increased slightly to 5.159 percent in August 2024, up from 5.721 percent in August 2023. This increase is attributed to the US Federal Reserve’s policy, which led to a fixed weighted average interest rate of 6 percent for repurchase operations since August 2023.
The trends in Oman’s money supply and interest rates reflect ongoing adjustments to global monetary policy, particularly in alignment with US Federal Reserve actions.
