UAE Central Bank Sought US Swap Line After 8% Monetary Base Drop as Iran War Hit Tourism
Updated
Updated · DW (English) · Aug 18
UAE Central Bank Sought US Swap Line After 8% Monetary Base Drop as Iran War Hit Tourism
3 articles · Updated · DW (English) · Aug 18
Summary
The UAE central bank asked the US for a dollar swap line after the Iran war disrupted the economy, a move economists described as a precautionary backstop rather than evidence of acute financial stress.
An 8% fall in the UAE monetary base in March helped explain the request, even as officials publicly rejected any suggestion of a dollar shortage or need for external support.
Dubai's hotel market showed the sharpest damage: occupancy fell from 80% to about 10%, prompting 50% staycation discounts, closures for renovations and a broader 680 million-dollar support package for affected sectors.
The fallout has spread beyond tourism, with analysts warning of weaker foreign investment, job cuts, higher import costs and softer real estate prices while many expatriates face lost work.
Oxford Economics said the shock is highly sectoral, with retail, transport and tourism under pressure, but finance and government-linked activity cushioning the blow; visitor inflows are not expected to return to 2025 levels until 2028.