Residents to see more interest rate cuts soon

IT CAN HELP THEM SPEND, SAVE, OR INVEST DIFFERENTLY

- BY JUSTIN VARGHESE

Interest rates in the UAE are falling. After the US Federal Reserve cut rates by 25 basis points on Wednesday, the Central Bank of the UAE lowered its benchmark rate.

Borrowing costs will soon get cheaper, leaving residents with key choices: spend, save, or invest differently. Mortgages, personal loans, and credit cards with variable rates may see lower monthly payments.

Bill Banfield, Chief Business Officer at Rocket Mortgage, says: “Consumers could benefit from lower short-term rates, making adjustable-rate mortgages — which closely follow the Fed’s moves — more attractive.”

Freeing up disposable income

Lower debt payments free up disposable income and could boost demand in property markets, especially in prime locations. Traditional savings accounts and fixed deposits will generate lower returns.