UAE Central Bank increases interest rate: How will it affect residents?

In line with the US Federal Reserve's move, the Central Bank of the UAE raised its base rate by 75 basis points, effective from Thursday, 16 June 2022. Major central banks of emerging and developed markets raised interest rates in 2021 and initiated the same practice this year to contain inflation, which surged to multi-decade highs in the US and other major economies of the world.

Here's all you need to know about what effect the hike will have in the Emirates.

How will the UAE Central Bank's move impact consumers?

The interest rate hike will be reflected in equated monthly instalments (EMIs) on home, vehicle and other personal and corporate loans. Consumers will have to pay higher EMIs, as higher rates will make it more expensive to buy a home/car or carry a credit card balance.

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