CBO
Releases its Macroeconomic Stability Report 2025

Muscat,
29 Jan 2026 (ONA) — The Central Bank of Oman (CBO) released its Macroeconomic
Stability Report 2025, a periodic flagship publication providing an analytical
assessment of recent macroeconomic developments and their spillovers to the financial
system. The report presents a forward-looking evaluation of economic and
financial conditions, enhancing transparency and providing a reference for
policymakers, market participants, and researchers, in line with Oman Vision
2040.

The
report is structured around an integrated assessment of global developments and
oil market dynamics; domestic economic conditions; monetary sector
developments; fiscal balance and fiscal performance; external buffers and the
sustainability of the exchange rate peg; price stability and inflation risks;
and sovereign ratings and perceived country risk. Together, these pillars
provide a coherent macro-financial framework for evaluating economic
conditions, identifying vulnerabilities, and assessing their implications for
financial stability.

The
report notes that economic activity remained resilient amid a challenging
global environment. Real GDP growth reached 1.6 percent in 2024 and accelerated
to 2.3 percent year-on-year in the first half of 2025, reflecting moderate hydrocarbon
output alongside sustained expansion in non-hydrocarbon sectors. Growth was
driven mainly by services and manufacturing, supported by ongoing
diversification efforts and increased private sector investment.

Fiscal
developments continued to support macroeconomic stability. Fiscal consolidation
efforts—underpinned by expenditure rationalization, non-oil revenue
mobilization, and proactive public debt management—contributed to an improved
fiscal position. Together with contained inflation and a stable external
position, these developments helped reduce macroeconomic and macro-financial
vulnerabilities.

Monetary
and financial conditions remained broadly accommodative while preserving price
and exchange rate stability. The exchange rate peg of the Omani Rial to the
U.S. dollar continued to provide a credible nominal anchor. The banking sector
remained sound, supported by adequate capital and liquidity buffers, resilient
asset quality, and a robust regulatory and supervisory framework. Liquidity
conditions in the financial system were comfortable, facilitating continued
credit intermediation to the productive sectors of the economy.

Looking
ahead, the report assesses the near- to medium-term outlook as favorable,
supported by ongoing structural reforms, strategic investment, and an improving
business environment. Continued progress in economic diversification, human
capital development, and productivity-enhancing reforms will be essential to
sustaining growth and strengthening resilience to external shocks.

Overall,
the Macroeconomic Stability Report 2025 complements other flagship reports
produced by CBO and serves as an effective information tool aims to monitor
developments, assess risks, and evaluate the implications of macroeconomic
trends for financial stability.

—Ends/AG