US rate hikes make Gulf sovereign wealth funds go-to source for capital

Al-Monitor Pro Members

Sebastian Castelier

Business journalist covering Gulf economies

Nov. 23, 2022

Cash is no longer cheap. The US Federal Reserve delivered several “jumbo” interest rate hikes in 2022. Major central banks have followed suit and pivoted to ​​quantitative tightening, possibly leading to the “biggest liquidity drain” in history. However, flush with cash from an oil windfall, Gulf sovereign wealth funds — which control more than $3 trillion worth of assets — are back at their 2007-2009 financial crisis playbook: financiers of last resort. The stated goal? Snap up assets across the world to swap part of the “oil rent” for an “assets rent.”