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The Central Bank of the UAE (CBUAE) announced an increase in money supply aggregate M1 by 1.7 per cent, from Dhs1,081.3 billion at the end of January 2026 to Dhs1,099.8 billion at the end of February 2026.
The increase was supported by an increase in currency in circulation outside banks by 1.4 per cent and in monetary deposits by 1.8 per cent.
The money supply aggregate M2 increased by 2.4 percent in February 2026, rising from Dhs2,789.8 billion at the end of January to Dhs2,856.8 billion at the end of February 2026. This growth was mainly driven by Dhs48.5 billion increase in Quasi-Monetary Deposits. The corporate sector made the largest contribution, with deposits rising by 2.1 per cent and accounting for 1.0 p.p. of the overall M2 growth.
Individuals’ deposits also increased significantly, up by 5.3 per cent and contributing 0.8 p.p. Deposits from Government-Related Entities (GREs) grew by 1.8 per cent, adding 0.2 percentage points to M2 growth, primarily due to higher AED demand and savings deposits. Other Financial Corporations (OFC) deposits contributed positively to M2 growth, recorded increase by 13.0 per cent (mostly foreign currency demand deposits).
The money supply aggregate M3 increased by 1.6 percent, rising from Dhs3,301.5 billion at the end of January 2026 to Dhs3,353.7 billion at the end of February 2026.
Government sector deposits recorded a monthly decrease of 2.9 percent, reaching AED496.9 billion, and contributed negatively to M3 growth by 0.4 p.p. Despite this decline, the overall increase in M3 reflects the positive contributions from other deposit categories, which offset the reduction in government sector deposits.
The monetary base increased by 2.0 per cent, from Dhs900.8 billion at the end of January 2026 to Dhs918.6 billion at the end of February 2026. The increase was driven by the growth in: Banks & OFCs Current Accounts & Overnight Deposits of Banks by 33.6 per cent, Reserve Requirements by 1.1 per cent and currency issued by 0.6 percent. Monetary Bills & Islamic Certificates of Deposit decreased by 4.3 per cent, which moderated the growth of overall aggregate.
Gross banks’ assets increased by 1.1 percent from Dhs5,413.6 billion at the end of January 2026 to Dhs5,472.5 billion at the end of February 2026.
Gross credit increased by 1.2 percent, rising from Dhs2,598.2 billion at the end of January 2026 to Dhs2,630.6 billion at the end of February 2026. This overall growth was primarily supported by AED20.6 billion increase in domestic credit. The main driver was credit to the private sector, which grew by 1.3 per cent and contributed 0.8 p.p. to the total gross credit growth.
A smaller positive contribution came from credit to GREs, which increased by 1.1 per cent, adding 0.2 p.p. However, the growth in domestic credit was partially offset by a decline in credit to the Government sector, which fell by 1.1 per cent for the second consecutive month, resulting in a negative contribution of 0.1 p.p to overall domestic credit growth.
Banks’ deposits increased by 1.9 per cent, from Dhs3,336.8 billion at the end of January 2026 to Dhs3,400.0 billion at the end of February 2026. The increase in banks’ deposits was driven mostly by the growth in resident deposits by 1.7 per cent reaching Dhs3,098.2 billion (contributing 1.6 p.p.), while non-resident deposits grew by 3.8 per cent reaching Dhs301.8 billion.
Within the resident deposits, the biggest contribution (1.6 p.p.) came from private sector deposits increase by 2.2 per cent reaching 2,322.0 billion, while GRE and OFC deposits positively contributed the same (by 0.2 p.p.), while recording increase by 1.8 per cent and 10.3 per cent respectively. At the same time, government sector deposits decreased by 2.3 per cent settling at Dhs392.0 billion, at the end of February 2026.
WAM
