Saudi Cash Injection: Better Late Than Never

A $29bn cash injection will help relieve pressure on the Saudi banking sector.

Saudi Arabia has begun injecting large amounts of money into the economy, data published by the central bank on 28 November revealed. Net foreign assets at Sama, the Saudi central bank, shrank by $11bn from September to $544bn in October, 16.3% down on a year earlier and their lowest level since December 2011 (see chart).

The central bank also sharply drew down on its foreign deposits in October, by $11.6bn to $102.7bn. Riyadh on 19 October raised $17.5bn in its first international bond issuance so the drop in foreign deposits has led analysts to deduce that the Saudi government may have brought home a total of around $29.1bn in October. (CONTINUED - 1038 WORDS)