The Central Bank of the United Arab Emirates has decided to lower the base interest rate on overnight deposit facilities by 0.25%, bringing it down from 4.40% to 4.15%, effective Thursday, September 18.
This decision follows the Federal Reserve’s announcement of a 25 basis point reduction in the reserve rate during its meeting held on Wednesday.
Additionally, the central bank has opted to maintain the rate applicable to short-term liquidity borrowing from the bank through all existing credit facilities at 50 basis points above the base rate.
The base rate is connected to the interest rate on reserve balances set by the U.S. Federal Reserve, and it reflects the overall monetary policy stance. It also establishes a minimum effective interest rate for overnight money market rates within the country.