ID :
63576
Mon, 06/01/2009 - 14:28
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Shortlink :
https://oananews.org//node/63576
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Dollar to stay as UAE reserve currency
The current weakness in the dollar is a "temporary situation" and nothing could replace it as a reserve currency, the UAE Central Bank Governor Sultan Bin Nasser Al Suwaidi said on Sunday according to a report in "Gulf News".
"The dollar is the currency of international trade, not the euro. It is the currency for investment," he said
Speaking to reporters here on the sidelines of a Memorandum of Understanding signing ceremony between the Anti-Money Laundering and Suspicious Cases Unit of the UAE Central Bank and the Financial Transactions and Reports Analysis Centre of Canada, Al Suwaidi said: "I think there is no other currency to replace the dollar. It [the dollar peg] is not to be replaced in the near future."
Asked if sticking to the dollar would mean no more speculative money coming into the UAE, Al Suwaidi said: "We don't control the minds of speculators. They can do whatever they want to do and we will do whatever we want to do."
Al Suwaidi affirmed the UAE's plans to remain out of the proposed GCC monetary union for the time being after a media report yesterday said the four remaining participants in the project - Saudi Arabia, Qatar, Kuwait and Bahrain - would sign an accord on June 7. "We are withdrawn. We are out at this point," he said.
Sultan Bin Saeed Al Mansouri, UAE Minister of Economy, recently told reporters the UAE might rethink its decision to pull out of the monetary union if the GCC reconsiders a decision on the location of the GCC Central Bank in favour of Abu Dhabi.
"The decision has to go back to the Cabinet of the UAE. We have to feel comfortable with the decision ourselves," Al Mansouri told reporters at the time.
Separately, Al Suwaidi said tougher rules with regard to the UAE banks' capital adequacy ratio (CAR) are for the benefit of the country's banking system.
"We are a small economy. We have to be tougher. We don't have the same liquidity pools as they have in Europe or America," he said. "We are a more straightforward banking system, taking money from depositors and lending it to borrowers," Al Suwaidi added.
Al Suwaidi said most but not all of the banks would meet the Central Bank's June 30 deadline to increase their capital adequacy ratio to a minimum of 11 per cent. "Most banks will meet it," he said.
Asked about non-dollar reserves of the Central Bank, Al Suwaidi said: "It is still within the limits of law. Always we have to maintain the requirements of law and we are within the requirements."
"The dollar is the currency of international trade, not the euro. It is the currency for investment," he said
Speaking to reporters here on the sidelines of a Memorandum of Understanding signing ceremony between the Anti-Money Laundering and Suspicious Cases Unit of the UAE Central Bank and the Financial Transactions and Reports Analysis Centre of Canada, Al Suwaidi said: "I think there is no other currency to replace the dollar. It [the dollar peg] is not to be replaced in the near future."
Asked if sticking to the dollar would mean no more speculative money coming into the UAE, Al Suwaidi said: "We don't control the minds of speculators. They can do whatever they want to do and we will do whatever we want to do."
Al Suwaidi affirmed the UAE's plans to remain out of the proposed GCC monetary union for the time being after a media report yesterday said the four remaining participants in the project - Saudi Arabia, Qatar, Kuwait and Bahrain - would sign an accord on June 7. "We are withdrawn. We are out at this point," he said.
Sultan Bin Saeed Al Mansouri, UAE Minister of Economy, recently told reporters the UAE might rethink its decision to pull out of the monetary union if the GCC reconsiders a decision on the location of the GCC Central Bank in favour of Abu Dhabi.
"The decision has to go back to the Cabinet of the UAE. We have to feel comfortable with the decision ourselves," Al Mansouri told reporters at the time.
Separately, Al Suwaidi said tougher rules with regard to the UAE banks' capital adequacy ratio (CAR) are for the benefit of the country's banking system.
"We are a small economy. We have to be tougher. We don't have the same liquidity pools as they have in Europe or America," he said. "We are a more straightforward banking system, taking money from depositors and lending it to borrowers," Al Suwaidi added.
Al Suwaidi said most but not all of the banks would meet the Central Bank's June 30 deadline to increase their capital adequacy ratio to a minimum of 11 per cent. "Most banks will meet it," he said.
Asked about non-dollar reserves of the Central Bank, Al Suwaidi said: "It is still within the limits of law. Always we have to maintain the requirements of law and we are within the requirements."
