Qatar's Inflation will be Around 2 to 3%, Says QCB Governor

Doha, September 18 (QNA) - Qatar's inflation rate will continue to be steady around 2 to 3%, the Governor of Qatar Central Bank (QCB) said Tuesday. Speaking to reporters on the sidelines of Capital Markets Conference which opened here today, HE QCB Governor Sheikh Abdullah bin Saud Al Thani said, "The inflation rate will be around 2 to 3% this year." Inflation rates in Qatar remain much lower compared to other GCC nations. This helped QCB to spur growth in 2011 by lowering interest rates. "Qatar's central bank is very comfortable with current interest rates and is not concerned about hot money inflows," the Governor said replying to question asked by a reporter. The Governor also reiterated to the media that "QCB will set up a credit ratings institution in association with Qatar Holding Company as soon as possible. This process is going on and its part of our initiative to set up a domestic credit ratings for issuers." In his address to the gathering, comprising policy-makers and top management executives from the banking, financial and equity markets, HE Sheikh Abdullah said, "Qatar is also setting up a clearing house for share market settlements in association with Qatar Exchange (QE) by the end of this year." Replying to question on the probability of setting up a common GCC market for bonds and equities following the opening panel session which discussed 'Developing Debt Markets in the GCC,' HE Sheikh Abdullah said, "Most central banks in the region are working towards achieving a uniform system for government and non-government bonds and equities. We can tackle this by organising a listing system among others." Cautioning that developing capital markets is not just a question of listing, but it is an all-round package development. "It should take care of the interests of both local and foreign investors," he added. Expressing optimism on this, Central Bank of Oman Executive President Hamood bin Sangour Al Zadjali, said, "Talks are going on and we hope we can achieve this goal of common GCC markets." On the hurdles impeding the development of debt markets in the GCC, International Monetary Fund (IMF) Middle East and Central Asia Director, Masood Ahmed, speaking to Qatar News Agency (QNA) said, "Although we are not starting from scratch in this region, many GCC countries are already issuing Treasury Bonds. However, the state of development and functioning of debt markets in the GCC is still in its early stages. The road map ahead is to adopt a more systematic approach." The IMF executive suggested focusing on developing the basic building blocks. To this objective a proactive approach is required from all stake holders - the governments, central banks and all market regulatory authorities. Ahmed suggested focusing on four key areas to develop debt markets in the GCC - concentrate on developing liquid Treasury Bond market which is transparent; facilitate diversification; create good institutions, ratings system and good accountability standards and lastly transparency in pricing and improving micro systems which provide liquidity. He said the IMF is ready to contribute in the development of debt markets in the GCC by supporting governments to put in place a comprehensive plan. "The IMF can help in building the basic blocks, we are committed in this area if the goal is to move from a partial to a more forceful development of the debt markets." (QNA)