Despite the ongoing regional tensions and uncertainty in the global market, the United Arab Emirates (UAE) drew strong investor demand in its latest local-currency bond sale.
In a statement, the UAE’s Ministry of Finance said it raised 1.1 billion dirhams, or about $300 million, through a dual-tranche auction of dirham-denominated Treasury bonds.
The bids even reached 4.74 billion dirhams, or 4.3 times the amount on offer, the ministry said.
The bonds were issued in coordination with the Central Bank of the UAE. It included tranches maturing in September 2027, with a yield to maturity of 4.03%, and in January 2031, priced at 4.30%, the ministry said.
The spreads were as tight as 14 basis points above comparable U.S. Treasuries at issuance, suggesting investors continue to view UAE sovereign debt as relatively low-risk.
The latest auction marks the UAE’s third sovereign dirham debt issuance since the outbreak of regional conflict earlier this year.
Combined, the three offerings have raised 3.3 billion dirhams and attracted more than 14.5 billion dirhams in orders across maturities ranging from 18 months to seven years.
The UAE has been steadily expanding its domestic debt market as Gulf governments seek to diversify funding sources, deepen local capital markets, and reduce reliance on foreign-currency borrowing.
The securities are listed on Nasdaq Dubai, helping broaden access for institutional investors and supporting secondary market liquidity. Nasdaq Dubai has become an increasingly active venue for regional fixed-income listings, including sukuk and ESG-linked debt instruments.
The pricing could also encourage more regional issuers to tap domestic debt markets at a time when global borrowing costs remain elevated, and investors are becoming more selective about emerging-market risk.
Some market participants see the UAE’s growing dirham debt market as part of a longer-term strategy to strengthen the country’s position as a regional financial hub competing with international centres such as Singapore and Hong Kong.
