RIYADH: The Central Bank of the UAE (CBUAE) will launch a new index for overnight funding transactions denominated in UAE Dirham in December.
DONIA aims to provide market participants with interbank market data, and to improve transparency in domestic money market activities, as a part of the new Dirham Monetary Framework implementation plan.
It is a volume-weighted money market rate for all overnight secured and unsecured funding transactions of 10 million UAE Dirhams ($2.7 million) or greater.
“We, at the CBUAE, are confident that this new reference rate will provide additional transparency to the Dirham money markets.
It also helps the CBUAE in ensuring overnight money market rates are aligned to prevailing base rate,” governor of the CBUAE, Khaled Mohamed Balama said.
