The Saudi Arabian Monetary Agency has said to the banks in the country that it is banning the use of options and other derivatives to speculate against the riyal, a news report suggested. The central bank’s effort is to reduce pressure on its currency peg. The central bank wants to make sure that there is no snowball effect against the riyal in the forwards markets, the news said quoting a person. The order is viewed as a renewed attempt to prevent low oil prices, which have took Saudi Arabia with big state budget and external deficits, from pressuring the riyal’s three-decade-old peg of 3.75 to the US dollar.
