This decision was taken following the US Federal Reserve Board’s decision to increase the Interest on Reserve Balances (IORB) by 25 basis points…reports Asian Lite News
The Central Bank of the UAE (CBUAE) has decided to raise the Base Rate applicable to the Overnight Deposit Facility (ODF) by 25 basis points – from 4.4% to 4.65%, effective from 2 February 2023.
This decision was taken following the US Federal Reserve Board’s decision to increase the Interest on Reserve Balances (IORB) by 25 basis points.
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.
The central banks of Saudi Arabia and Bahrain increased their interest rates after the US Federal Reserve raised its target interest rate by a quarter of a percentage point on Wednesday.
The Saudi Central Bank, known as Sama, and the Central Bank of Bahrain upped their interest rates by 25 basis points in statements.