They expected the US stimulus plan to give a hand to
struggling Middle East equity prices and push up oil prices on the world
market, enabling Arab oil producers to collect larger surplus petrodollars.
The US central bank on Wednesday decided to buy 600 billion dollars
in additional bonds to boost the sluggish economy.
“I believe the US step will have a positive impact on both
Arab stocks and oil prices in the short term,” Jawad Anani, a prominent
Jordanian economic expert and columnist, told Arab News.
”In the medium term, the US stimulus plan will push up both
prices and interest rates,” said Anani, who runs an economic consultancy bureau
in Amman.
However, Anani expected the Fed’s quantitative monetary
easing to put downward pressure on the dollar, due to the large quantities of
dollars which will be available at the world market by mid-2011.
“This means that Middle East currencies, particularly those
pegged to the greenback, will come under devaluation pressures,” Anani said.
Financial analyst Wajdi Makhamreh expected the new US
stimulus to leave a ”positive sentiment” in Arab countries, particularly in the
Gulf states.
Makhamreh, CEO of the Amman-based Noor Investments
brokerage, said the Middle East petrochemical sectors and governments would be
the major beneficiary in both the short and long terms.
“Any gains scored by the Wall Street and other global
markets as a result of the US monetary easing will have a positive
psychological impact on Arab markets, particularly in the Gulf Cooperation
Council states, which have direct affiliations with US and European markets,”
Makhamreh said.
“Higher oil prices will mean larger surplus dollars that
seek investment outlets including equity markets,” he said.
