Weak dollar no reason to sever peg
The UAE central bank ruled out any change to exchange rate policy, saying a spell of dollar weakness was no reason to review the dirham's peg to the US currency, a regional daily reported on Tuesday.
"Each currency fluctuates, and if its value fell at a certain time, that does not mean we should start thinking about de-linking," the paper quoted Central Bank Governor Sultan Nasser Al Suweidi as saying.
The UAE, the world's sixth largest oil exporter, has no intention of changing exchange rate policy, the paper said, citing Suweidi. It did not give a direct quotation.
Suweidi triggered a spell of intense market speculation about the imminent demise of the Gulf's fixed exchange rates, after he said in November he was under mounting social and economic pressure to sever the dirham's dollar peg.
He backtracked on those remarks after Gulf rulers agreed at a summit in Qatar to retain the dollar pegs and keep any talks on currency reform secret. Suweidi said on December 5 the dirham's exchange rate would not change for "the foreseeable future". (Reuters)
Follow Emirates 24|7 on Google News.