UAE Vice-President and Prime Minister Sheikh Mohammed bin Rashid
al-Maktoum has confirmed the federation is considering removing the
dirham’s peg to the US dollar, while saying he is confident that
inflation in the federation will solve itself.
Source: MEED
Maybe UAE should peg to the Euro instead of USD; the euro is stable, at least.
If the UAE de-pegs, It would require more skills to come up with the state budget. UAE's primary output is oil, even if Dubai is an exception, and oil is traded in dollars. The dollar is down but that I think is not the only factor for the inflation in the UAE. There's just too much money around the Gulf. Anyway, I am not an economist, but it was interesting news that I thought would definitely affect expatriates salaries (I mean the equivalent of their salaries in the country they come from).
the Gulf countries are supposed
to act together when it comes to breaking the dollar peg. Since they
are trying to ensure some equality so that at some point they all move
to a single currency (like the Euro), that why the monetary decisions
are supposed to be made together.
However, as you know Kuwait decided to unpeg unilaterally. Now everybody else is still pegged.
i think if a deicions to get rid of the dollar peg is to be made, only one of the big fish could make that
decision (like Saudi Arabia or UAE). Let's wait and see
Cheers to all...
Dollar peg to stay in the interest of nation
By Gulfnews
Dubai: A panel of experts appointed by the UAE government to examine the merits of changing the dirham's peg to the dollar on Wednesday recommended that it is in the interest of the country to maintain the currency's existing peg to the dollar.