UAE central bank keeps base rate steady

The Central Bank of the UAE (CBUAE) on Wednesday decided to maintain the base rate applicable to the Overnight Deposit Facility (ODF) without change at 5.40 per cent.

This decision was taken following the US Federal Reserve Board’s announcement earlier on Wednesday to keep the Interest on Reserve Balances (IORB) unchanged.

The CBUAE also has decided to maintain the rate applicable to borrowing short-term liquidity from the CBUAE through all standing credit facilities at 50 basis points above the Base Rate.

The Base Rate, which is anchored to the US Federal Reserve’s IORB, signals the general stance of the CBUAE’s monetary policy. It also provides an effective interest rate floor for overnight money market rates in the UAE.

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