US President Donald Trump on Tuesday indicated that he is considering the possibility of a currency swap with the United Arab Emirates to help the Mideast ally secure US dollars, as its oil-rich economy has been rattled by the ongoing Iran war.
During an interview with CNBC, the US 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.
Also read: UAE asks US for a wartime financial lifeline as Iran conflict drags
“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.”
While UAE 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,” Jason Tuvey, an analyst at Capital Economics told The Associated Press.
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Eariler on Monday, the Wall Street Journal reported that the UAE as opened talks with the US about obtaining a financial backstop in case the Iran war plunges the oil-rich Persian Gulf state into a deeper crisis.
UAE Central Bank Governor Khaled Mohamed Balama has raised the idea of a currency-swap line with Treasury Secretary Scott Bessent and Treasury and Federal Reserve officials in meetings in Washington last week, WSJ reported quoting officials.