Qatar riyal sinks in forwards market on loan concern

One-year US dollar/riyal forwards rises as high as 312 points, their highest level since February 2009
Qatar riyal sinks in forwards market on loan concern
Qatar money, Qatar currency, Qatar finance, Qatar banking, Qatar finance
By Reuters
Wed 25 Nov 2015 02:47 PM

Qatar's riyal fell sharply in the forward foreign exchange market on Wednesday because of concern about the country's progress in obtaining a syndicated loan of up to $10 billion from banks, traders said.

One-year US dollar/riyal forwards rose as high as 312 points, their highest level since February 2009 during the global financial crisis, from 250 points on Tuesday.

Earlier this month, bankers said Qatar was in talks with banks for a loan of up to $10 billion to help cover its expenses. Qatar is one of the wealthiest of the Gulf Arab energy exporters, but its income has been pressured by low oil and gas prices.

The five-year loan was expected to carry a margin below 100 basis points over the London interbank offered rate, one of the bankers said at the time. Qatar was aiming to complete the deal by the end of this year.

On Wednesday, senior traders at two major Gulf banks said there was talk in the market that banks were having trouble agreeing with Qatar on the pricing of the loan.

Comment could not immediately be obtained from Qatari finance ministry or central bank officials.

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