Askume, Sept 20 – Dubai shares closed higher on Friday, extending the previous day’s gain, as most central banks in the region followed the Federal Reserve in lowering key interest rates, although the Abu Dhabi index retreated.
The Federal Reserve lowered its benchmark interest rate 50 basis points (bps) on Wednesday and is expected to deliver a half-basis point cut before the end of the year, a full basis point cut next year, and a half-basis point cut in 2026.
The UAE central bank said in a statement that it cut the base interest rate on its overnight deposit facility by 50 basis points on Wednesday, to 4.90% from 5.40%.
Monetary policy in the Gulf Cooperation Council (GCC) generally follows Federal Reserve decisions, as most regional currencies are pegged to the US dollar.
Dubai’s main stock index (.DFMGI) rose 0.3%, with Parkin Company (PARKIN.DU), which oversees public parking in the UAE, gaining 4.3%.
In Abu Dhabi, Conglomerate International Holding Co (IHC.AD) fell 1.4% and the index (.FTFADGI) dropped 0.7%.
Oil prices, a catalyst for Gulf financial markets, retreated but were on track to rise for a second straight week after the Federal Reserve cut interest rates and global inventories drew.
