In its report on the Monetary & Banking Developments for May 2022, CBUAE clarified that the gross credit grew by 2.6 percent rising from AED1,817.4 billion at the end of April 2022 to AED1,865.5 billion at the end of May 2022. Gross Credit rose due to 3.0 percent increase in Domestic Credit, overriding the 0.1 percent reduction in Foreign Credit.
Domestic Credit mounted mainly due to 1.4 percent, 1.3 percent, 3.5 percent and 16.9 percent surges in credit to Government Sector, Public Sector (Government Related Entities), Private Sector and Non-Banking Financial Institutions, respectively.
Total Bank Deposits increased by 1.6 percent, climbing from AED2,008.4 billion at the end of April 2022 to AED2,040.5 billion at the end of May 2022. The growth in Total Bank Deposits was due to the ascent in Resident Deposits by 2.0 percent, overshadowing the reduction in Non-Resident Deposits by 1.2 percent.
Resident Deposits increased owing to 10.6 percent, 6.1 percent and 0.02 percent escalations in Government Sector Deposits, Public Sector (Government Related Entities) Deposits and Private Sector Deposits, respectively. On the other hand, Non-Banking Financial Institutions Deposits diminished by 18.0 percent.
The Central Bank also said that the Money Supply aggregate M1 decreased by 2.8 percent, from AED730.4 billion at the end of April 2022 to AED710.1 billion at the end of May 2022. The fall was due to AED4.6 billion reduction in Currency in Circulation Outside Banks and AED15.7 billion decrease in Monetary Deposits.
The Money Supply aggregate M2 (that includes M1 + Quasi-Monetary Deposits) increased by 0.1 percent, from AED1,567.3 billion at the end of April 2022 to AED1,568.1 billion at the end of May 2022. M2 rose due to AED21.1 billion increase in Quasi-Monetary Deposits, overriding the drop in M1.
The Money Supply aggregate M3 (that includes M2 + Government Deposits) also rose by 1.7 percent, from AED1,858.6 billion at the end of April 2022 to AED1,890.2 billion at the end of May 2022. M3 soared due to the elevated M2, boasted by AED30.8 billion growth in Government Deposits.
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