United Arab Emirates' Money Stock Climbs to AED 946.4 Billion in the Month of December 2024

The Central Bank of the United Arab Emirates (CBUAE) recently published a report on Monetary & Banking Developments for December 2024, revealing a robust and resilient financial sector in the UAE.

According to the report, the UAE's monetary base grew by 4.4%, reaching AED 780.6 billion. This growth was primarily due to a 23.7% rise in banks and other financial corporations' (OFCs) current accounts and overnight deposits with CBUAE.

The narrow money supply, M1, rose by 2.3% to AED 946.4 billion. The increase in M1 was driven by an AED 1.1 billion increase in currency circulation and a AED 20.6 billion surge in monetary deposits.

Banks' deposits in the UAE grew by 1.5% to AED 2,847.0 billion. This growth was driven by a 13.9% increase in non-resident deposits and a 0.5% rise in resident deposits.

Gross credit in the UAE rose by 0.8% to AED 2,181.1 billion, with foreign credit increasing by 8.3%. Despite a AED 27.1 billion decline in government deposits, this did not significantly impact the growth of M3.

M2, a broader money supply measure, expanded by 1.7% to AED 2,317.5 billion. The growth of M2 was supported by higher M1 and a AED 17.0 billion increase in quasi-monetary deposits.

The broader M3 aggregate edged up 0.4% to AED 2,778.9 billion. Notably, the latest report does not provide information about the changes in M1, M2, M3, or the monetary base.

The growth in the UAE's financial sector suggests a positive trajectory for 2025. The latest data indicates a resilient financial sector in the UAE with stable liquidity levels.

The UAE's financial sector continues to attract growing foreign investment. Khaled Mohamed Balama, the Managing Director (Governor) of the Central Bank of the United Arab Emirates, oversaw this growth in December 2024.

The gross banks' assets in the UAE increased by 2.4% to AED 4,560.0 billion. With these promising figures, the UAE's financial sector is poised for continued growth and stability in the coming year.