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    A Saudi banker displays the new one hundred riyal banknote bearing the portrait of Saudi King Abdullah bin Abdul Aziz al-Saud at a bank in Riyadh, 05 June 2007

    Banks on Alert! Speculators ‘Attacking Saudi Riyal'

    © AFP 2017/ HASSAN AMMAR
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    The Saudi currency is under strong pressure due to falling oil prices. The Saudi banks are forced to suspend derivatives trading to decrease pressure on the riyal, German newspaper Deutsche Wirtschafts Nachrichten (DWN) reported.

    Saudi Arabia's central bank warned the country's banks against increasing speculations on the devaluation of the national currency.

    Several bankers said on Wednesday they were told not to conduct derivatives trading to minimize the pressure on the riyal, the newspaper reported, citing Reuters.

    According to the news agency, the move proved to be successful in supporting the national currency. A key currency indicator in Saudi Arabia — riyal forward points — decreased to 690 points on Wednesday from a record 1,020 points last week.

    The Saudi currency is currently under heavy pressure due to falling oil prices which, combined with declining government reserves, lead to its devaluation.

    Last week, oil prices dropped below $30 a barrel the first time in 12 years. Speculators argue that the country will soon have to change the exchange rate between the riyal and the dollar if the situation does not improve.

    Related:

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    Tags:
    crisis, currency, oil prices, Saudi Arabia
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