Trump Says Administration Is Weighing Currency Swap For UAE

 

Washington : Trump confirmed in his CNBC interview that he’s considering a request from the United Arab Emirates Central bank for a currency swap to help secure dollar liquidity for the oil-rich economy that’s been rattled by the Iran conflict.

The president expressed surprise that the nation needs assistance, but made clear he was open to the prospect of making the move to help meet his ally’s concerns.

 

“I mean I’m surprised because they are really rich,” Trump said. He added, “You know, they’re very good for this country. So, yeah, if I could help them, I would.” More on the UAE as US weighs offering it a currency swap

The United Arab Emirates, an autocratically ruled federation of seven sheikdoms on the Arabian Peninsula that’s home to Dubai, became wealthy from its oil deposits. It pegs its currency, the dirham, to the U.S. dollar.

While it has been able to send some of its oil out via a pipeline to the Gulf of Oman, the closure of the Strait of Hormuz has squeezed the country’s oil exports.

 

The UAE has an estimated $2.5 trillion in savings and sovereign wealth funds, but may be seeking the swap to “bolster investor confidence in the UAE’s financial position if the war were to drag on,” said Jason Tuvey, an analyst at Capital Economics.