U.A.E. to Postpone Changes to How It Calculates Key Rate - Bloomberg

U.A.E. to Postpone Changes to How It Calculates Key Rate - Bloomberg:

"The United Arab Emirates central bank’s plan to change the way a key interest rate used to price debt is calculated has been postponed, according to two people familiar with the matter.

For several months, banks that form part of a panel that contributes to the Emirates Interbank Offered Rate every day have been submitting interest rate quotes using both the current and proposed system, the people said, asking not to be identified because the information is private. The new method, which was supposed to be implemented this week, made the rate more volatile, they said.


The change was planned as the Federal Reserve seeks to boost borrowing costs further this year. The U.A.E. typically follows U.S. monetary policy decisions because its currency is pegged to the dollar. The last time the central bank proposed changing the way Eibor is calculated was in 2009, when interest rates plummeted, according to Aarthi Chandrasekaran, the vice president for research at Shuaa Capital in Dubai."



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