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UAE money supply increased during May

Haseeb Haider/principal Correspondent
Filed on June 26, 2015
UAE money supply increased during May

Alp Eke, senior economist at National Bank of Abu Dhabi, said there has been a recent stabilisation or possibly decline in government and public sector deposits.

UAE money supply increased during May (/assets/oldimages/moneyarti2506.jpg)

Abu Dhabi — The Central Bank of the UAE said the Money Supply aggregate M1 increased by 1.9 per cent to Dh482.8 billion at the end of May 2015. Money Supply aggregate M2 also increased by 1.4 per cent, to Dh1.198 trillion at the end of May 2015 and following the same trend Money Supply aggregate M3 increased 0.4 per cent to Dh1.38 trillion at the end of May 2015.

The increase in M1 and M2 was attributed to Dh8.6 billion increase in monetary deposits and Dh7.7 billion increase in quasi-monetary deposits, which was also carried forward to M3, according to the Central Bank of the UAE. Commenting on the banking indicators, Alp Eke, senior economist at National Bank of Abu Dhabi, said there has been a recent stabilisation or possibly decline in government and public sector deposits.

In May 2015, deposits rose 4.8 per cent year on year to reach Dh1.446 billion. In the same month, government deposits decreased by 6.2 per cent year on year and constituted 12.6 per cent of total deposits.

In April 2015, breakdown of deposits shows public sector deposits declined 13 per cent year-on-year to Dh173.8 billion, and constituted 36.7 per cent of total deposits down from 49.6 per cent from March 2014.

According to Central Bank of the UAE’s released monthly report, gross bank assets, including bankers’ acceptances, increased by 0.4 per cent, to Dh2.39 trillion at the end of May 2015. The Central Bank monthly report said in May, total bank deposits rose by Dh5.3 billion reaching Dh1.446 trillion, chiefly due to Dh7.4 billion increase in resident deposits.

NBAD economist said that latest available Central Bank data shows government and public sector deposits declined to Dh368 billion, one per cent year on year, down from Dh403 billion in August 2014.

The economist said, Central Bank of the UAE’s foreign assets reached Dh315 billion up four per cent y-o-y. There seems to be a stabilisation of assets since the third quarter, 2014. Gross credit increased by 0.8 per cent, rising to Dh1.432 trillion at the end of May 2015, according to the Central bank of the UAE data for May.

Alp Eke said the loan to deposit ratio reached lowest point at 87 per cent in June 2014. Currently in May 2015, it is around 91 per cent.

haseeb@khaleejtimes.com 





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