UAE interest rates rise as Saudi Arabia, Qatar, Bahrain and Oman hike while Kuwait holds
UAE interest rates rise after the US Fed hike, with Saudi Arabia, Qatar, Bahrain and Oman also raising rates while Kuwait holds steady
On Thursday, September 17, the UAE Central Bank raised its base interest rate to 3.9%, up from 3.65%. This rate adjustment was prompted by the Federal Reserve's first rate hike since 2023, which increased its benchmark rate by 25 basis points to a range of 3.75% to 4.00%. The UAE rate follows the US rate change due to both economies' monetary policy frameworks being linked through the pegged value of the UAE dirham to the US dollar.
For borrowers with variable-rate mortgages, the new base rate could lead to higher monthly payments when their loan terms are next reviewed. However, homeowners with fixed-rate mortgages will not face immediate changes to their payments. New borrowers of mortgages, car loans, or personal loans may also be impacted as higher rates increase borrowing costs across the financial system.
Savers may benefit from the higher interest rates, as banks could offer better returns on deposits. Comparing deposit rates offered by different banks will help determine the best options for those with savings.
Written by urgent.news from Gulf News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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