UAE will not cut interest rates 'immediately'

Central Bank governor admits contraction possible but no action on interest rates yet. 
UAE will not cut interest rates 'immediately'
By Daliah Merzaban
Wed 25 Mar 2009 10:14 AM

All Gulf Arab economies face a possible economic contraction this year but the UAE will definitely not cut interest rates immediately, the Emirate's central bank governor said on Wednesday.

Sultan Nasser Al Suweidi told reporters that the UAE was looking at how to bridge loan-to-deposit ratios.

He said that banks' capital adequacy ratios would be raised to 11 percent by June 30.

"A contraction is a possibility in all GCC countries," he said.

"It is still on the drawing board with the UAE finance ministry to help bridge a gap between loans and deposit ratios," he added. (Reuters)

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