UAE Central Bank raises base rate by 75 basis points

The Central Bank of the UAE (CBUAE) will raise the Base Rate applicable to the Overnight Deposit Facility (ODF) by 75 basis points – from 2.4 per cent to 3.15 per cent, effective from September 22.

It follows the US Federal Reserve Board’s decision to increase the Interest on Reserve Balances (IORB) by 75 basis points.

The CBUAE has also 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 signals the general stance of the CBUAE’s monetary policy and provides an effective interest rate floor for overnight money market rates.