The Central Bank of the UAE decided to maintain the Base Rate for the Overnight Deposit Facility at 3.65%. Moreover, the decision followed the US Federal Reserve’s move to keep the Interest Rate on Reserve Balances unchanged.
Standing Credit Facilities Unchanged
The Central Bank also maintained the rate for borrowing short-term liquidity at 50 basis points above the Base Rate. Additionally, this applies to all standing credit facilities, therefore ensuring consistency across the monetary framework.
Monetary Policy Signal
The Base Rate remains anchored to the US Federal Reserve’s Interest Rate on Reserve Balances. As a result, it continues to signal the general stance of monetary policy and provide an effective floor for overnight money market interest rates in the UAE.
