UAE prime minister Sheikh Mohammed bin Rashid al Maktoum approved the measures at a meeting of the government on 12 October. He also agreed to further capital injections into the banking system if necessary.

In late September the Central Bank of the UAE launched a AED50bn liquidity fund to help stimulate the local interbank lending market, which had dried up as banks became nervous about lending to each other.

However, the measures failed to improve sentiment and the Dubai Financial Market fell 5.41 per cent on 12 October, to the lowest it has been for 43 months.

The Tadawul stock market in Saudi Arabia fell to a four year low.