The Central Bank of the United Arab Emirates decided to reduce the interest rate on certificates of deposit for a one-week maturity period by 75 basis points, starting today, March 16, 2020.
According to the Emirates News Agency, this decision is in line with the decision of the US Federal Reserve to cut the interest rate on federal funds at its emergency meeting yesterday, in the face of the repercussions of the emerging corona virus as a benefit - 19.
The central bank also decided to keep the repo repurchase rate, which applies to borrowing short-term liquidity from the central bank by guaranteeing certificates of deposit by 50 basis points above the price of certificates of deposit for a one-week maturity period.
The central bank also decided to reduce the price of marginal lending facilities and murabaha facilities covered by guarantee by 50 basis points, to 50 basis points above the repo repurchase rate of certificates of deposit.
The certificates of deposit issued by the central bank to banks operating in the country represent the monetary policy tool through which the effects of changing interest rates are transferred to the banking system in the country.
