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Central Bank of the UAE statement on monetary, banking developments in December.

The Central Bank of the UAE has announced that the money supply aggregate M0 (currency in circulation and cash at banks) increased by 1.4 per cent, from AED 73.5 billion at the end of November to AED 74.5 billion at the end of December 2014, according to Emirates News Agency WAM.

However, the money supply aggregate M1 (currency in circulation plus monetary deposits) decreased by 0.8 per cent, from AED 441.9 billion at the end of November to AED 438.5 billion at the end of December 2014. This reduction was a result of 2.6 per cent and 1.7 per cent decrease in currency in circulation and monetary deposits which accounted for13.5 per cent and 86.5 per cent respectively, of total M1.

The Money Supply aggregate M2, which comprises M1 and quasi-monetary deposits, increased by 0.1 per cent, from AED 1140.1 billion at the end of November to AED 1414.4 billion at the end of December2014. The increase in M2 was attributed to 0.6 per cent rise in quasi-monetary deposits which accounted for 61.6 per cent of total M2, overshadowing the 2.6 per cent and 0.5 per cent decrease in currency in circulation and monetary deposits that accounted for 5.2 per cent and 33.3 per cent respectively of total M2.

The money supply aggregate M3 (M2 plus Government Deposits) also decreased by 1.9 per cent, from AED 1357.8 billion at the end of November to AED 1332 billion at the end of December 2014. This reduction was brought about by 12.3 per cent reduction in Government deposits that dominated the increase in M2.

Gross bank assets including bankers' acceptances, decreased by 0.8 per cent during the month of December 2014, falling from AED 2342.6 billion at the end of November to AED 2323 billion at the end of December 2014. Similarly, gross bank loans and advances decreased by 0.1 per cent, dropping from AED 1397.9 billion at the end of November to AED 1396.2 billion at the end of December 2014.

Total bank deposits decreased by AED 4.7 billion during the month of December 2014, falling to AED 1421.3 billion. This was a result of AED 22.8 billion decrease in resident deposits, which accounted for 89.2 per cent of total bank deposits, overriding an increase of AED 18.1 billion in non-resident deposits, which accounted for 10.8 per cent of total bank deposits in December 2014.

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Publication:CPI Financial
Date:Feb 2, 2015
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