The government did not publicise the sale, but it was hardly a surprise given its deteriorating finances. To maintain spending despite falling oil revenue, it has been cashing in foreign assets at a rapid clip: $60 billion in the first six months of the year. In July Fahd al-Mubarak, the head of the Saudi Arabian Monetary Agency (SAMA), the kingdom’s central bank, announced the government had raised $4 billion selling bonds to state-owned institutions, and talked of more sales to come .... http://www.economist.com
Monday, August 17, 2015
Saudi Arabia borrows to compensate for falling oil prices
On August 10th Saudi Arabia issued bonds worth 20 billion riyals ($5.3 billion). Local banks, the only institutions allowed to take part in the sale, have lots of spare cash. The price was appealing, too: the ten-year bonds (there were also five- and seven-year issues) will yield almost half a percentage point more than their American equivalents.
The government did not publicise the sale, but it was hardly a surprise given its deteriorating finances. To maintain spending despite falling oil revenue, it has been cashing in foreign assets at a rapid clip: $60 billion in the first six months of the year. In July Fahd al-Mubarak, the head of the Saudi Arabian Monetary Agency (SAMA), the kingdom’s central bank, announced the government had raised $4 billion selling bonds to state-owned institutions, and talked of more sales to come .... http://www.economist.com
The government did not publicise the sale, but it was hardly a surprise given its deteriorating finances. To maintain spending despite falling oil revenue, it has been cashing in foreign assets at a rapid clip: $60 billion in the first six months of the year. In July Fahd al-Mubarak, the head of the Saudi Arabian Monetary Agency (SAMA), the kingdom’s central bank, announced the government had raised $4 billion selling bonds to state-owned institutions, and talked of more sales to come .... http://www.economist.com
