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The Central Bank of the United Arab Emirates (CBUAE) pumped AED7.3 billion into the country’s market in March 2019 according to a statement in WAM. The move was aimed at boosting liquidity and compensating banks for considerable amounts of funds withdrawn out of excess liquidity in the market over recent months.
The statement added that the move fits within the CBUAE’s mandate to direct the country’s credit policy. This includes regulating and overseeing the monetary and banking policy, ensuring their alignment with the government’s general plan in a way that ultimately strengthens the domestic economy, assures financial stability, regulates cash flows and withdraws cash surplus in order to retain economic resilience.
According to figures released by the CBUAE, certificates of deposit declined to AED 139.2 billion by the end of March 2019, from AED 146.5 billion in February. Injecting additional liquidity could generate more business momentum, according to analysts.
Over the first two months of 2019, a total of AED 8 billion in cash was withdrawn from the market, after AED 12.4 billion-worth of excess liquidity was withdrawn in December 2018, according to CBUAE figures.
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