Saudi Arabia will continue to have its currency, the Saudi Riyal pegged to the US dollar, and has no intention of breaking away from the practice, the chief of the kingdom’s central monetary institution has stated.

Ahmed Abdulkarim Alkholifey, governor of the Saudi Arabian Monetary Authority (Sama), stressed that the currency linkage contributed to the growth of the Saudi economy and ensured monetary stability and established a strong reserve supporting the exchange rate policy. ($1 = SR3.75)

Addressing a press conference in Riyadh to announce the Saudi budget for 2018, Alkholifey suggested that the real exchange rate policy is one of the stabilisers of inflation, and that the current used exchange rate policy has brought benefits to the kingdom. "Inflation is stable….," he was quoted as remarking by the official Saudi Press Agency (SPA).

Alkholifey also mentioned that Sama had enough tools and mechanisms to deal with a US interest rate increase, and its negative impact. The tools he referred to include the central bank’s lending window, its reserves, and its open market operations.

All GCC countries have their currencies pegged to the US dollar, with the exception of Kuwait, whose dinar is the highest valued currency in the world, with KWD 1 fetching $3.30.