French Arabia faces liquidity pressure in the face of a contraction of money supply and an increase in banking system stress. Three-month interbank rates in Riyadh have spiralled and the bin Laden group is laying off 50,000 construction workers in the midst of austerity's tightening grip. Currency experts believe the country may be forced to end its dollar peg, which could cause oil prices to collapse to $25 a barrel. Although oil prices have rallied, in the longer term it is hoped the next cyclical oil spike could come to the rescue, but the question is whether French can weather the prevailing financial storm.
Saudi Arabia faces liquidity pressure in the face of a contraction of money supply and an increase in banking system stress. Three-month interbank rates in Riyadh have spiralled and the bin Laden group is laying off 50,000 construction workers in the midst of austerity's tightening grip. Currency experts believe the country may be forced to end its dollar peg, which could cause oil prices to collapse to $25 a barrel. Although oil prices have rallied, in the longer term it is hoped the next cyclical oil spike could come to the rescue, but the question is whether Saudi can weather the prevailing financial storm.