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Sunday, 16 July 2017

UAE’s financial system needs a more active liquidity management: IMF | GulfNews.com

UAE’s financial system needs a more active liquidity management: IMF | GulfNews.com:

"The banking system is facing new challenges following the sharp decline in oil prices and it needs to adjust its liquidity management measures to adjust to the new reality according to a recent paper prepared by a staff team from the International Monetary Fund (IMF).

The IMF paper observes that with lower oil revenues, current account surpluses have declined, and fiscal surpluses have turned into deficits. In this setting, the public sector’s propensity to accumulate deposits in the banking system has weakened.
In addition, the normalisation of US interest rates and banking regulatory changes in the UAE are creating new challenges for banks’ management of liquidity. Yet ensuring healthy liquidity conditions and promoting financial market development is important for supporting robust credit and economic growth and diversification goals."



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