According to the Central Bank of the UAE (CBUAE), the total assets of the gross banks, including bankers’ acceptances, grew by 0.8 percent from AED4,075.2 billion in December 2023 to AED4,109.1 billion ($1.11 trillion) in January 2024.
In its report on monetary and banking developments for January 2024, the bank stated that gross credit increased by 0.2 percent from AED1,991.7 billion in December 2023 to AED1,996.2 billion in January 2024.
The CBUAE reported that the increase in gross credit was driven by a 1.9 percent growth in foreign credit, which offset a slight decline of 0.01 percent in domestic credit. Domestic credit decreased due to contractions of 0.1 percent, 1.3 percent, and 13.6 percent in credit to the government sector, the public sector (government-related entities), and non-banking financial institutions, respectively. However, credit to the private sector increased by 0.5 percent in January 2024.
Total bank deposits rose by 0.7 percent, increasing from AED2,521.9 billion in December 2023 to AED2,539.9 billion in January 2024. This increase was driven by a 0.9 percent growth in resident deposits, which offset a 1.8 percent decrease in non-resident deposits.
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Resident deposits
Resident deposits expanded due to increases of 4.7 percent in government sector deposits, 1.0 percent in public sector (government-related entities) deposits, and 1.0 percent in private sector deposits. However, deposits from non-banking financial institutions fell by 24.9 percent.
Monetary base
The monetary base expanded by 1.8 percent, rising from AED658.8 billion in December 2023 to AED670.9 billion in January 2024. This increase was primarily driven by a 12.8 percent growth in monetary bills and Islamic certificates of deposit, which offset reductions of 0.4 percent in currency issued, 1.4 percent in reserve account, and 9.5 percent in banks’ and other financial corporations’ current accounts and overnight deposits at CBUAE.
Money supply
The money supply aggregate M1 increased by 0.1 percent, rising from AED829.3 billion in December 2023 to AED830.0 billion in January 2024. This increase was due to a rise of AED0.9 billion in currency in circulation outside banks, which offset a decrease of AED0.2 billion in monetary deposits.
The money supply aggregate M2 increased by 0.2 percent, rising from AED2,023.4 billion in December 2023 to AED2,028.3 billion in January 2024. This increase was driven by the growth in M1 and a rise of AED 4.2 billion in quasi-monetary deposits.
The money supply aggregate M3 also increased by 1.3 percent, rising from AED2,445.2 billion in December 2023 to AED2,478.0 billion in January 2024. This increase was due to the expansion of M2 and a rise of AED27.9 billion in government deposits.
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