UAE central bank raises benchmark interest rate in step with Fed

    The United Arab Emirates central bank raised its key overnight interest rate by 5 basis points on Thursday, in step with a similar move by the U.S. Federal Reserve a day earlier.

    The UAE’s base rate for overnight deposits is anchored to the Fed’s Interest on Excess Reserves (IOER), which the US central bank raised by 5 basis points to 0.15 percent at the end of a two-day policy meeting on Wednesday.ECONOMYCoronavirusUAE central bank expects GDP growth as country recovers from COVID restrictions

    The UAE central bank said in a statement it had also raised its base rate to 0.15 percent.

    “This decision was taken following the US Federal Reserve Board’s yesterday’s announcement to increase the Interest on Excess Reserves (IOER) by 5 basis points,” it said.

    The central bank also decided to maintain the rate applicable to borrowing short-term liquidity through all of the central bank’s standing credit facilities at 50 basis points above the base rate, it said in the statement.

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