The Interbank lending rate (EOBOR) has continued to remarkably decline across all terms, with the six-month rate slipping to a several-year-old trough of 0.75 % on July 23rd from 2.2 % early this year, and the one-year term dipping to 1.1 % against 2.28 % during the same reference period, according to the Central Bank of the UAE’s figures.
The rate serves as the yardstick for other interest rates in the economy, including lending and financing rates of differing types, which reflects positively on reducing business costs nationwide.
It’s noteworthy that the United Arab Emirates is ranked 16 among 190 economies in the ease of doing business, according to the latest World Bank annual ratings.
The three-month and one-month interest rates likewise declined to 0.62 % and 0.33 % respectively.
The UAE Dirham is pegged to the US Dollar and therefore the interest decline is attributed to the US Federal Reserve’s decisions that lowered interest rates more than once over the past months.