Husam Abdul Nabi (Dubai)
Financial experts said the UAE central bank’s decision to raise interest rates in line with the US Federal Reserve’s decision was a necessary step, especially given the UAE’s dirham’s value against the US dollar. Al-Ittihad assured that the central banks of the world would follow the decisions of the US Federal Reserve when raising or lowering interest rates, aimed at increasing the stability of inflation in consumer prices for the third time since last March. In global and local markets.
Osama al-Ashri, a member of the United Kingdom’s Association of Technical Analysts, said the central bank’s monitoring of the US Federal Reserve’s interest rate hike was a result of the United Arab Emirates’ dirham being linked to the US dollar. Oil futures agreements must comply with the decisions of the same central bank on raising or lowering interest rates to avoid disparities. On the currency, he explained that the merger of the United Arab Emirates Central Bank with the US Federal Reserve was not linked to inflation. United Arab Emirates, but aims to preserve the value of oil futures deals. Al-Ashri pointed out that raising interest rates in the United Arab Emirates in response to the US Federal Reserve’s decision to raise interest rates would increase the cost of borrowing. The Central Bank of the United Arab Emirates (UAE) has been closely monitoring the US Federal Reserve’s decisions regarding interest rate hikes for the current year. .
For his part, changes in interest rates have both positive and negative effects on markets because higher interest rates mean consumers do not have more income and they need to cut costs, so inflation must be controlled. The banking sector in the United Arab Emirates is likely to be hit hard by rising interest rates in light of rising bank interest rates.
Mohamed Shaker, a financial expert, dismissed the special concern that raising interest rates would affect credit performance, particularly based on the rate of increase on loans and mortgages, and would not lead consumers to stop borrowing or push them. Borrow at a low rate. Shakir said the hike would have only a small effect on the interest payments of borrowers.
He emphasized that the increase in borrowing costs and the increase in credit services would have a “very significant effect” on countries with high levels of debt and high levels of foreign debt, and certainly not the United Arab Emirates.
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