(MENAFN- Gulf Times) Qatar remains fully committed to its currency peg to the US dollar and is not reviewing its currency policy, Central Bank Governor HE Sheikh Abdullah bin Saud al-Thani said yesterday.
"We are fully supporting the peg and will not re-examine this policy...This has been our policy for years and will stay the same," he told Reuters on the sidelines of a meeting of regional central bankers in Doha. He declined to elaborate on the reasons for Qatar sticking to its peg.
Earlier this year Khalid Alkhater, the Qatar central bank's director of research and monetary policy, said Gulf Cooperation Council economies might need to rethink their monetary policies and the long-term sustainability of their currency pegs to the dollar as Gulf and US economies diverged.
Since then, however, several GCC central bank governors, including those of the UAE and Bahrain, and now Qatar, have ruled out any change to their pegs. The recommendations of the committees and the working groups under the Supervision and Control Committee Over Banking System are related to the unified guiding principles of banking supervision and the mechanisms of information exchange between credit information centres in the GCC countries.
The meeting discussed the latest developments in the fight against money laundering and terrorism-financing in the GCC countries, and the preparations to hold the 12th GCC Banking Conference, which will be hosted by Oman in the second half of 2015. HE Sheikh Abdullah said that the meeting is held amid global changes that had negative impact on the global economy and led to a decline in growth rates and an increase in unemployment levels in most economies of the world, except in the US, pointing out that this also caused fluctuation in financial markets, with rising dollar and falling oil prices, a matter which led to a decrease in inflation rates.
Major central banks around the world have adopted expansionary monetary policies bolstered by quantitative easing programmes to recover their economies, HE the QCB Governor said, noting that the economies of the GCC countries were affected by these developments. Decreasing oil prices are an additional challenge to the GCC countries and a burden on their public budgets, he said.
"The GCC countries are undergoing an exceptional period that requires us to take the necessary actions and measures to meet the potential repercussions," he said, stressing on the need to coordinate monetary policies and unify efforts to ensure financial and banking stability.
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