The UAE Central Bank today said that money supply (currency in circulation + currency at banks) decreased by 1.3 per cent from Dh53.8 billion at the end of May to Dh53.1 billion at the end of June.
In a statement, the apex bank said money supply aggregate M1 (currency in circulation plus monetary deposits) increased by 0.9 per cent to Dh284.3 billion in June, compared to a month earlier. Money supply aggregate M2, which comprises M1 and quasi-monetary deposits, decreased by 0.6 per cent to Dh827.1 billion at the end of June, compared to May, it added.
“June and July are slower compared to other months. The central bank figures indicate less liquidity in the system, it also means capital outflows or remittances out of the system have been more pronounced,” Dubai-based economist Nasser Saidi told Gulf News by telephone.
The central bank said money supply aggregate, M3 (M2 plus government deposits at banks operating in the UAE as well as at the Central Bank) decreased by 2.6 per cent from Dh1,055.7 billion at the end of May to Dh1,028.6 billion at the end of June.
It also said the total bank deposits decreased by 1.6 per cent during the month of June to close at Dh1,107.0 billion. Meanwhile, total bank loans and advances (net of provisions and interest in suspense) increased by 1.5 per cent to reach Dh1,090.4 billion, and total bank assets increased by 0.4 per cent to reach Dh1,732.7 billion, at the end of June.
During the first six months of 2012, the apex bank said intermediary monetary aggregate M2 increased by 0.2 per cent, while bank loans and advances increased by 1.8 per cent and bank deposits increased by 3.5 per cent