Central Bank Reports Growth in UAE Money Supply, Bank Assets, and Deposits in July 2024

The Central Bank of the UAE announced a growth in key financial indicators for July 2024, with increases recorded across various money supply aggregates, bank assets, and deposits.

The money supply aggregate M1 rose by 0.6% from AED884.1 billion in June to AED889.3 billion in July, driven by a modest AED0.2 billion increase in currency in circulation outside banks and a more substantial AED5.0 billion rise in monetary deposits. Similarly, M2 grew by 1.7% to AED2,205.9 billion, fueled by the M1 increase and a notable AED31.3 billion boost in quasi-monetary deposits. M3 also saw a 1.7% increase, reaching AED2,676.0 billion due to M2 growth and a AED7.5 billion rise in government deposits.

However, the monetary base decreased by 1.0%, from AED725.0 billion to AED718.1 billion, mainly due to a 12.0% reduction in the reserve account and a 0.5% decline in currency issued. This drop overshadowed increases in banks' current accounts and overnight deposits by 26.6% and a marginal 0.04% rise in monetary bills and Islamic certificates of deposit.

Bank assets, including bankers’ acceptances, rose by 0.9% to AED4,348.6 billion. Gross credit expanded slightly by 0.1% to AED2,102.1 billion, with a 0.3% increase in domestic credit offsetting a 1.5% decline in foreign credit. Domestic credit growth was supported by increases in lending to the government and private sectors.

Total bank deposits grew by 1.6%, reaching AED2,736.0 billion. This increase was due to a rise in resident deposits by 1.5% and non-resident deposits by 2.4%, with significant gains seen in deposits from government-related entities.

News Source: Emirates News Agency