Kuwait committed to monetary union despite ending peg



We are fully committed to accomplishing the monetary union and the unified GCC currency,” said al-Sabah, who was talking on the sidelines of a meeting of Arab central bank heads in Damascus.



Kuwait, the fourth largest oil producer in the Middle East, ended its currency’s peg to the dollar on May 20 in an attempt to end the rising inflation which it said was mainly caused by the weakening greenback.



The move meant it will be harder for Kuwait to join a GCC unified currency as its monetary policy is now different from the rest of the five GCC states, which peg their currencies to the dollar.



Meanwhile, Kuwait’s central bank left the dinar rate unchanged near a 19-year high for a second day yesterday. The dinar will trade around a mid point of 0.28090 per dollar, the central bank said.



Kuwait allowed the dinar to rise to its highest since December 1988 on Sunday as the dollar hit a 15-year low against a basket of currencies. The currency has risen 2.93% since May 19, a day before the central bank dropped its peg to the weakening dollar and adopted a basket of currencies.


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