Country Report Saudi Arabia February 2011

Outlook for 2011-15: Exchange rates

Saudi Arabia, Bahrain, Kuwait and Qatar remain committed to plans for a Gulf monetary union despite the withdrawal of Oman and the UAE. A joint monetary council has been established with the governor of SAMA as its chairman and this is likely to evolve into a central bank by the end of 2012. However, the countries still need to agree on various technical issues and meet the convergence criteria, and a single GCC currency is unlikely until later in the forecast period. The peg may therefore be adjusted in 2014-15 to prepare for a single currency. A single currency would probably also initially be pegged to the dollar, although a currency basket might be introduced later.

© 2011 The Economist lntelligence Unit Ltd. All rights reserved
Whilst every effort has been taken to verify the accuracy of this information, The Economist lntelligence Unit Ltd. cannot accept any responsibility or liability for reliance by any person on this information
IMPRINT