September 17, 2019 / 1:30 PM / 2 months ago

Saudi central bank says 2019 GDP growth will be near IMF forecast

Saudi Arabia's Monetary Authority Governor Ahmed al-Kholifey speaks during a news conference at Saudi Arabian Monetary Agency Headquarters, in Riyadh, Saudi Arabian, September 17, 2019. REUTERS/Ahmed Yosri

RIYADH (Reuters) - Saudi Arabia’s economic growth this year will not be too far from the forecast made by the International Monetary Fund, central bank Governor Ahmed al-Kholifey said on Tuesday.

The IMF expects the Saudi economy to grow 1.9%, slower than last year’s 2.2%. Some economists are more bearish because of cuts in oil output.

Kholifey’s said it was too early to comment on the economic impact of the attacks on Saudi oil facilities on Saturday. Those attacks knocked out half the Saudi oil output and damaged the world’s biggest crude oil processing plant, triggering the largest jump in oil prices in decades.

Asked if there would be impact on bank’s liquidity, he said that the central bank did not expect any shortage in liquidity but was prepared to support the market if needed.

Reuters reported on Tuesday that Saudi Arabia’s oil output will be fully restored more quickly than was first thought: two or three weeks, not months.

Kholifey said he did not expect Aramco’s planned initial public offering to affect liquidity in the banking sector, as all indicators remain healthy, adding that loan to deposit ratio remains at 78%, under the 90% limit.

He added that the central bank may revise its current lending regulations to facilitate availability of liquidity to investors before the IPO.

“Aramco size requires looking at the issue from a different perspective,” he said.

Editing by Saeed Azhar, Larry King

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