Abu Dhabi, UAE – The Central Bank of the United Arab Emirates (CBUAE) announced Tuesday that the Money Supply aggregate M1 decreased by 0.2 percent, from AED 720.6 billion ($196 billion) at the end of July 2022 to AED 719.4 billion ($195 billion) at the end of August 2022.
The Money Supply aggregate M2 increased by 1.4 percent, from AED 1,606.0 billion ($437 billion) at the end of July 2022 to AED 1,627.7 billion ($443 billion) at the end of August 2022, according to the apex bank’s Monetary and Banking Developments Report for August 2022.
The Money Supply aggregate M3 also rose by 2.4%, from AED 1,968.3 billion ($535 billion) at the end of July 2022 to AED2,016.1 billion ($549 billion) at the end of August 2022.
The reduction in M1 was due to AED 1.2 billion decrease in Currency in Circulation Outside Banks, where Monetary Deposits remained constant. M2 increased due to AED 22.9 billion rise in Quasi-Monetary Deposits, overshadowing the diminished M1. M3 grew due to an augmented M2 and AED 26.1 billion increase in Government Deposits.
The Monetary Base expanded by 1.2 percent rising from AED 469.9 billion at the end of July 2022 to AED 475.4 billion at the end of August 2022.
The main drivers of this expansion in the Monetary Base were increases in Reserve Account and Certificates of Deposit & Monetary Bills by 41.2 percent and 0.6 percent, respectively. Currency Issued and Banks & OFCs’ Current Accounts & Overnight Deposits of Banks at CBUAE fell by 1.5 percent and 14.4 percent, correspondingly.
The gross banks’ assets, including bankers’ acceptances, rose by 0.9 percent, up from AED 3,490.4 billion at the end of July 2022 to AED 3,523.5 billion at the end of August 2022.
The gross credit fell by 0.3 percent from AED 1,857.4 billion at the end of July 2022 to AED 1,851.1 billion at the end of August 2022.
Gross Credit reduced due to 0.4 percent reduction in Domestic Credit, overriding the 0.3 percent increase in Foreign Credit.
Domestic Credit fell because of 0.9 percent, 1.2 percent, 0.2 percent and 1.5 percent decline in credit to Government Sector, Public Sector (Government Related Entities), Private Sector and Non‐Banking Financial Institutions, respectively.
The total bank deposits increased by 1.6 percent, climbing from AED 2,132.9 billion at the end of July 2022 to AED 2,166.6 billion at the end of August 2022.
The growth in Total Bank Deposits was due to the rise in Resident Deposits by 2.8 percent, superseding the reduction in Non-Resident Deposits by 7.0 percent. Resident Deposits increased owing to 7.1 percent, 3.3 percent, 1.5 percent and 0.8 percent expansions in Government Sector Deposits, Public Sector (Government Related Entities) Deposits, Private Sector Deposits and Non-Banking Financial Institutions Deposits, individually.