Middle East & North Africa Economics Update Banks to weather the storm, but pockets of risk linger Banking sectors across the Middle East and North Africa are generally well placed to weather the current economic downturn but there are pockets of vulnerability, particularly in Qatar and parts of... 17th June 2020 · 5 mins read
Middle East & North Africa Economics Update Lebanon’s crisis goes from really bad to even worse Lebanon’s government has made little progress with its economic rescue plan and there’s a growing likelihood that the sovereign debt and currency crises already underway will ultimately lead to series... 15th June 2020 · 4 mins read
Middle East & North Africa Economics Update Saudi inflation and the impact of the VAT hike The tripling of the VAT rate from July will cause inflation in Saudi Arabia to jump, but the impact may be relatively less severe than it was when VAT was first introduced at the start of 2018. That... 10th June 2020 · 3 mins read
Middle East & North Africa Economics Update Remittance slump adds to economic headwinds The measures to contain the coronavirus outbreak have shut down economies across the world, leading to job losses and falls in income. Migrant workers appear to have felt the brunt of this and the... 3rd June 2020 · 3 mins read
Middle East & North Africa Economics Update Saudi: Q2 collapse to be followed by weak recovery Our GDP Tracker suggests that the Saudi economy held up relatively well in Q1, but more timely low-profile data point to a collapse in activity in Q2. And, as lockdown measures are eased, the onset of... 1st June 2020 · 3 mins read
Middle East & North Africa Economics Update Saudi Arabia’s FX reserves: when should we worry? Saudi Arabia’s foreign exchange reserves are being depleted rapidly to protect the dollar peg, but we think that they would need to fall by more than $380bn to less than $100bn before the monetary... 20th May 2020 · 3 mins read
Middle East & North Africa Economics Update Oman: no devaluation, but a big dose of austerity Oman is one of the most vulnerable economies in the Gulf to a period of ultra-low oil prices but we think that financial support from its neighbours will avert the need to abandon the dollar peg. Even... 18th May 2020 · 5 mins read
Middle East & North Africa Economics Update CBE holds rates as it keeps a close eye on the pound The Central Bank of Egypt’s decision to keep interest rates unchanged today was not a major surprise given that efforts to prop up the pound have taken precedence over supporting the economy. If the... 14th May 2020 · 2 mins read
Middle East & North Africa Economics Update Saudi households at forefront of austerity drive The austerity measures announced by the Saudi government today reinforce our view that it will rely on fiscal consolidation rather than a devaluation to make the adjustment to cheap oil. The measures... 11th May 2020 · 3 mins read
Middle East & North Africa Economics Update A closer look at how Saudi Arabia uses its reserves There seems to be a lot of confusion as to exactly how Saudi Arabia uses its reserves to finance twin budget and current account deficits. In this Update, we shed some light on the matter. 5th May 2020 · 3 mins read
Middle East & North Africa Economics Update Lebanon heads to the IMF, but risks still abound The announcement that Lebanon will formally seek financial assistance from the IMF should help to avoid a more disorderly outcome from the country’s current debt crisis. However, we hold reservations... 1st May 2020 · 5 mins read
Middle East & North Africa Economics Update Egypt returns to the IMF Egypt has become the latest emerging market to turn to the IMF for assistance and one of the priorities for the Fund is likely to be for the central bank to loosen its grip on the pound. That said... 27th April 2020 · 6 mins read
Middle East & North Africa Economics Update Saudi can withstand pressure on riyal Pressure is mounting on Saudi Arabia’s dollar peg and, while there is some opaqueness over the full size of the Kingdom’s FX reserves, we estimate that the authorities could prop up the riyal at... 22nd April 2020 · 3 mins read
Middle East & North Africa Economics Update Gulf to rely on austerity rather than devaluations The collapse in oil prices has led to renewed pressure on dollar pegs in the Gulf and, while there could be some positive effects on balance sheets from devaluations, the costs would be politically... 21st April 2020 · 3 mins read
Middle East & North Africa Economics Update Oil output cuts mean Gulf slump to be even deeper The deal struck by OPEC and other oil producers to cut oil output sharply over the coming months will help to put a floor under oil prices, but the reduction in output simply adds to the reasons to... 14th April 2020 · 3 mins read
Middle East & North Africa Economics Update Egypt, the pound and lessons from the past Egypt’s central bank is intervening to prop up the pound, but the experience from the previous decade is that such efforts ultimately prove futile. If policymakers try to support the pound for an... 8th April 2020 · 3 mins read
