DUBAI, Sept 29 The Saudi riyal fell moderately
against the U.S. dollar in the forwards market on Thursday after
the U.S. Congress voted to allow relatives of victims of the
Sept. 11 attacks to sue Saudi Arabia.
The Senate and House of Representatives voted overwhelmingly
on Wednesday to override President Barack Obama's veto of
legislation permitting such lawsuits. The law grants an
exception to the legal principle of sovereign immunity in cases
of terrorism on U.S. soil, clearing the way for attempts to seek
damages from the Saudi government.
One-year dollar/riyal forwards, which are trades
scheduled to take place 12 months from now, were at 550 points
in early trade, up from Wednesday's close of 330 points. They
rose as far as an eight-week high of 625 points.
The Saudi riyal is pegged at 3.75 to the dollar in
the spot market, so banks often use the forwards market to hedge
Five-year Saudi credit default swaps, used
to insure against the risk of a sovereign debt default, rose
slightly to 157 points from 152. The price of state-controlled
Saudi Electricity Co's April 2023 dollar Islamic bond
, one of the few outstanding international bonds
from Saudi Arabia, did not move significantly.
(Reporting by Andrew Torchia; Editing by Toby Chopra)