The Central Bank of the UAE (CBUAE) cut the base rate for overnight deposit facility (ODF) by 25 basis points, from 4.65 per cent to 4.40 per cent.
The new rate will be effective from Thursday, December 19.
The decision follows the US Federal Reserve’s announcement to reduce the interest rate on reserve balances (IORB) by 25 basis points.
The UAE central bank also decided to maintain the interest rate applicable to borrowing short-term liquidity from the bank at 50 basis points above the base rate for all standing credit facilities.
The base rate, which is anchored to the US Federal Reserve’s IORB, signals the general stance of monetary policy and provides an effective floor for overnight money market interest rates in the UAE.
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