DUBAI – The United Arab Emirates is likely to revalue its currency against the flagging dollar in a bid to bring down inflation and meet criteria for a single Gulf currency, an industry report said on Monday. It is “most likely that the UAE central bank will revalue the dirham against the US dollar in line with other GCC currencies,” the Dubai Chamber of Commerce and Industry (DCCI) said. Oil-rich Gulf Cooperation Council (GCC) member states Bahrain, Kuwait, Qatar, Saudi Arabia and the UAE have set 2010 as the target date for adopting a monetary union and single currency. The DCCI said that while GCC states have met several convergence criteria in preparation for monetary union — including levels of public debt, budget deficits, interest rates and foreign reserves — the criteria set for inflation rates have not been satisfied. Since May, when Kuwait dropped its dollar peg and adopted a basket of currencies, there has been constant speculation that the UAE and Qatar would follow suit or revalue their currencies. GCC states, which are US allies, are experiencing high growth rates of between four and eight percent because of rising oil revenues that have boosted liquidity to new levels. read more
[Tags]gcc, currencies, inflation, uae, , criteria, forex news[/Tags]
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