The Central Bank of the UAE has officially decided to keep its benchmark interest rate at 3.65 percent, aligning itself with the latest monetary policy moves coming out of the United States. This decision specifically applies to the overnight deposit facility, ensuring that the country’s financial framework remains consistent with the US Federal Reserve’s recent choice to hold its key interest rates steady. Because the UAE dirham is pegged directly to the US dollar, the Central Bank routinely shadows the Fed’s adjustments to maintain stability across its financial markets.

In addition to maintaining the base rate, the Central Bank of the UAE confirmed that the interest rate for short-term liquidity borrowing will remain set at 50 basis points above the base rate. This move comes at a time when the US Federal Reserve is navigating persistent inflationary pressures, having recently revised its year-end inflation outlook upward. With American price increases currently sitting at a three-year high and unlikely to hit the target of two percent for several years, the UAE continues to adopt a cautious stance to remain synchronized with global economic trends.