Economics Editor, Europe, Middle East and Africa
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Aug 30, 2015

Saudi credit default swaps fall sharply on oil price recovery

DUBAI, Aug 30 (Reuters) – The cost of insuring against a
Saudi Arabian sovereign debt default has dropped sharply in the
past few days because of the rebound of global oil prices,
market data showed on Sunday.

Last Monday, five-year Saudi credit default swaps
soared as high as 120 basis points, from around
60 bps late last month.

Aug 20, 2015

Saudi riyal forwards hit as cheap oil erodes confidence

DUBAI, Aug 20 (Reuters) – Saudi Arabia’s riyal fell in the
forwards market on Thursday as oil prices dropped and Saudi
equities fell, prompting some traders to hedge against the risk
of the riyal’s peg to the U.S. dollar eventually coming under
pressure.

One-year dollar/Saudi riyal forwards jumped as high
as 305 points, their highest level since March 2003, from
Wednesday’s close of 250 points. The move signalled traders were
increasingly locking in rates to protect themselves against
potential riyal depreciation over the next 12 months.

Aug 16, 2015

Saudi money market turmoil shows bank jitters over bond issues

DUBAI, Aug 16 (Reuters) – Turmoil in the Saudi Arabian money
markets suggests that financing the government’s budget deficit
in an era of cheap oil may not be smooth as banks worry about
the risk of a liquidity squeeze.

The government sold 20 billion riyals ($5.3 billion) of
riyal bonds to banks last Tuesday to help to cover a huge
deficit caused by low oil prices. It was only the second
sovereign bond issue since 2007; the first, placed with
quasi-sovereign institutions, occurred in July.

Aug 12, 2015

Former Saudi official presses for change in managing oil wealth

DUBAI, Aug 12 (Reuters) – A former senior official at Saudi
Arabia’s central bank says he believes the kingdom may soon
change the way it manages its oil wealth as part of efforts to
protect its financial reserves in an era of cheap crude.

The Saudi Arabian Monetary Agency (SAMA) manages the vast
bulk of petrodollars earned by the world’s top oil exporting
country; net foreign assets at the central bank totalled $664.5
billion in June.

Aug 9, 2015

Saudi data suggest budget squeeze may be several years away

DUBAI, Aug 9 (Reuters) – Pressure on Saudi Arabia’s state
finances is mounting as oil prices fall but the latest official
figures suggest the world’s top crude exporter still has at
least several years before it faces a budget crunch.

Brent oil sank last week below $50 a barrel, near
six-year lows, from $70 three months ago. That promises to
increase the rate at which the kingdom is drawing down its
foreign reserves to cover its budget deficit.

Jul 28, 2015

UAE shifts fuel prices as the Gulf watches

DUBAI, July 28 (Reuters) – The United Arab Emirates has
become the first Gulf state to take a major step towards taming
the gas-guzzling habits of its drivers, who see cheap fuel as
part of their birthright.

The UAE said it would raise domestic prices for gasoline and
cut them for diesel in a politically sensitive reform designed
to save it money and encourage fuel efficiency.

Jul 27, 2015

UAE to cut state spending by 4.2 percent this year -central bank

DUBAI, July 27 (Reuters) – The government of the United Arab
Emirates is expected to cut spending by 4.2 percent this year as
it begins to retrench because of low oil prices, which are
slashing its energy export revenues, a central bank report said
on Monday.

The UAE does not regularly reveal consolidated state budget
data, and figures released in the quarterly report were the
first detailed picture of how authorities in the second biggest
Arab economy are responding to cheap oil.

Jul 15, 2015

How to spend $100 billion? Policy headaches loom for Iran

DUBAI (Reuters) – How to spend $100 billion may sound like a pleasant problem to have, but it is one of several economic policy headaches looming for Iranian President Hassan Rouhani after this week’s nuclear deal promised to lift sanctions crippling the economy.

Rouhani, and the technocratic cabinet he has installed, will have to manage a trade and investment boom without destabilizing the economy, and push through reforms to attract foreign capital without triggering a political backlash at home.

Jul 14, 2015

Iran gears up for trade and investment boom that could reshape region

DUBAI, July 14 (Reuters) – Iran is preparing for a trade and
investment boom that could reshape the region after agreeing
with world powers to curb its nuclear programme, paving the way
for sanctions that have stifled its economy to be lifted.

With just under 80 million people and annual output of some
$400 billion, Iran is set to be the biggest economy to rejoin
the global trading and financial system since the break-up of
the Soviet Union over two decades ago.

Jul 12, 2015

Gulf closes well off highs; Egypt rises in modest turnover

DUBAI, July 12 (Reuters) – Gulf stock markets came off early
highs to close mixed on Sunday, while Egypt continued to rebound
but low trading turnover cast doubt on whether any extended
recovery was beginning.

Buying of beaten-down blue chips boosted the Saudi index
as much as 0.8 percent in early trade, but it ended 0.3
percent lower.

    • About Andrew

      "Based in London, I manage economics and emerging markets coverage in the EMEA region and reporting on emerging markets in the area. Before moving to EMEA in early 2009 I spent almost 20 years in Asia as a journalist, based in Hong Kong, Taipei, Tokyo, Singapore and Shanghai."
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