In July 2024, the UAE’s money supply aggregates saw notable increases, according to the Central Bank. The M1 money supply rose by 0.6%, reaching Dh889.3 billion, driven by increases in currency circulation and monetary deposits.
Similarly, M2 grew by 1.7% to AED2,205.9 billion, thanks to the higher M1 and a Dh31.3 billion rise in quasi-monetary deposits. M3 also experienced a 1.7% increase, amounting to Dh2,676.0 billion, boosted by the M2 growth and a Dh7.5 billion uptick in government deposits.
Conversely, the monetary base declined by 1.0% to Dh718.1 billion, influenced by reductions in currency issued and reserve accounts, despite rises in banks’ current accounts and overnight deposits.
Overall, gross banks’ assets, including bankers’ acceptances, edged up by 0.9% to Dh4,348.6 billion. Gross credit saw a slight 0.1% increase, driven by a 0.3% rise in domestic credit, which offset a 1.5% drop in foreign credit. The domestic credit boost was due to higher lending to the government and private sectors, despite declines in credit to public sector entities and non-banking financial institutions.
Bank deposits rose by 1.6%, reaching Dh2,736.0 billion, thanks to increases in both resident and non-resident deposits. Resident deposits were bolstered by growth in the government sector, government-related entities, and private sector deposits, although non-banking financial institutions saw a decrease.
