The Central Bank of the UAE (CBUAE) announced on Wednesday that it will keep the base rate for the Overnight Deposit Facility (ODF) unchanged at 5.40 percent. The decision aligns with the US Federal Reserve Board's decision earlier in the day to maintain the Interest on Reserve Balances (IORB).
Furthermore, the CBUAE has opted to retain the interest rate for short-term liquidity borrowing through all standing credit facilities at 50 basis points above the Base Rate. The Base Rate, linked to the US Federal Reserve's IORB, serves as an indicator of the CBUAE's overall monetary policy direction and establishes a minimum interest rate for overnight money market rates in the UAE.
The United Arab Emirates (UAE) reported a 3.7% growth in its gross domestic product during the first half of the year, according to the country's economy minister. Notably, the non-oil sector experienced robust growth, with a 5.9% expansion in the first six months of the year. Speaking at a business conference in Dubai, Abdulla bin Touq Al Marri highlighted the UAE's economic resilience, diversification efforts, and commitment to international cooperation.
He emphasized that the UAE is reducing its reliance on oil and shifting towards knowledge-based industries. The non-oil sector now contributes over 70% to the country's GDP. In line with the broader trend in Gulf states, the UAE is actively diversifying its economy and revenue sources while attracting foreign investments. The country stands out for its progress in sectors like financial services, trade, tourism, and for its implementation of social and business reforms.
In the previous year, the UAE's economy grew by 7.9% in real terms, benefiting from increased oil prices and a rapid post-pandemic recovery in tourism and trade, particularly in Dubai, a key regional business and tourism center.
