Saudi Arabia as a sovereign had been inactive in the debt markets since 2007 until this year, but the falling oil price and an apparent unwillingness to dip (or to dip any further) into reserves, has prompted a rethink.
In July Fahad al-Mubarak, governor of the Saudi Arabian Monetary Agency, said it had issued $4 billion equivalent in local bonds, and in August it was reported that the country planned to raise a total of $27 billion by the end of the year, with issuance of about SR20 billion ($5.3 billion) a month in five, seven and 10-year paper until the end of the year.
|
"With the Saudi currency pegged to the dollar there isn’t much of a local-currency angle there” Abbas Ameli-Renani, Amundi |
That caused a lot of ears to prick up in the international investment community, although some were disappointed to find that the $27 billion headlines masked the fact that little, if any, is likely to be in dollars.
“We would be particularly interested in dollar-denominated paper to start off with,” says Abbas Ameli-Renani, global emerging markets strategist at Amundi, which has over $1 trillion in assets under management.
