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UAE’s central bank raises base rate by 75 bps to 3.15%

UAE’s central bank raises base rate by 75 bps to 3.15%
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UAE – Mubasher: The Central Bank of the UAE (CBUAE) hiked its base rate applicable to the Overnight Deposit Facility (ODF) by 75 basis points (bps) to 3.15% from 2.40%, effective from Thursday, 22 September 2022, Emirates News Agency (WAM) reported.

The move comes in parallel with the US Federal Reserve’s announcement on 21 September 2022 to increase the Interest on Reserve Balances (IORB) by 75 basis points.

The CBUAE also has decided to maintain the rate on borrowing short-term liquidity from the CBUAE through all standing credit facilities at 50 bps above the base rate.

In a similar move, the central banks of Saudi Arabia, Kuwait, Qatar, and Bahrain raised their interest rates. The Saudi Central Bank (SAMA) lifted its repo and reverse repo rates by 75 bps to 3.75% and 3.25%, respectively.

Furthermore, Qatar and Bahrain raised their main rates by 75 bps. Qatar's central bank increased its lending rate to 4.50%, deposit rate to 3.75%, and repo rate to 4%.

Bahrain raised its key policy interest rate on its one-week deposit facility to 4%, while Kuwait increased its key discount rate by 25 bps to 3%.