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CBUAE Issues Monetary And Banking Developments
(16 January 2024)

The Central Bank announced that the Money Supply aggregate M1 decreased by 0.2%, from AED 799.3 billion at the end of October 2023 to AED 797.4 billion at the end of November 2023.

This was due to AED 4.9 billion fall in Monetary Deposits. Currency in Circulation Outside Banks increased by AED 3.0 billion during November 2023.

The Money Supply aggregate M2 rose by 0.7%, from AED 1,922.3 billion at the end of October 2023 to AED 1,935.4 billion at the end of November 2023. M2 rose due to AED 15.0 billion rise in Quasi-Monetary Deposits, overriding the diminished M1.

The Money Supply aggregate M3 also increased by 0.5%, from AED 2,376.7 billion at the end of October 2023 to AED 2,388.6 billion at the end of November 2023. M3 Increased because of an augmented M2, overshadowing the AED 1.2 billion reduction in Government Deposits.

The Monetary Base expanded by 2.9%, from AED 596.9 billion at the end of October 2023 to AED 614.0 billion at the end of November 2023. The main driver of this increase in the Monetary Base was the rise in Currency Issued by 3.5%, in Banks OFCs’ Current Accounts Overnight Deposits of Banks at CBUAE by 19.1% and in Monetary Bills Islamic Certificates of Deposit by 1.1%.

Gross banks’ assets, including bankers’ acceptances, rose by 0.8%, from AED 3,995.7 billion at the end of October 2023 to AED 4,026.0 billion at the end of November 2023.

Gross credit increased by 1.0% from AED 1,974.2 billion at the end of October 2023 to AED 1,994.5 billion at the end of November 2023. Gross Credit rose due to rises in Domestic Credit by 0.8% and in Foreign Credit by 2.8%.

Domestic Credit grew because of 5.0%, 2.0% and 6.0% increases in credit to the Public Sector (Government Related Entities), Private Sector and to Non-Banking Financial Institutions, respectively.

Total Bank Deposits fell by 0.5%, reducing from AED 2,455.4 billion at the end of October 2023 to AED 2,444.3 billion at the end of November 2023. The decline in Total Bank Deposits was due to a decrease in Non-Resident Deposits by 9.3%, superseding an increase of 0.4% in Resident Deposits.

Resident Deposits rose owing to increase in Private Sector Deposits by 1.9%. While, Government Sector deposits and Public Sector (Government Related Entities) Deposits fell by 0.5% and 7.9%, respectively and Non-Banking Financial Institutions Deposits remained constant.