Kuwait: Fiscal flexibility needed – Standard Chartered

Economists expect Kuwuati growth to slow in 2020, despite higher oil production, on weaker non-oil economic activity. USD/KWD is trading at 0.3110.

Key quotes

“We expect growth to slow to 1% in 2020 (2.5% prior), despite a pick-up in oil production.” 

“We lower our Central Bank of Kuwait (CBK) discount rate forecast to 1.50% for 2020 and 2021 (2.75% prior) to reflect recent rate cuts; we see CBK on hold near-term.”

“We expect a fiscal deficit of KWD 8.7bn based on our USD 35/bbl oil forecast and assuming significant cuts to capital spending.”