Monday, May 21, 2007

Kuwait Ends Currency's Peg to Dollar, Pressuring UAE, Qatar to Follow Suit

(Bloomberg) -- Kuwait became the first Middle
Eastern country to abandon its currency's peg to the dollar to
help curb inflation, putting pressure on the United Arab
Emirates and Qatar to do the same.

The dinar rose 0.4 percent against the dollar after Kuwait
ended the peg and switched to a basket of currencies. A slump in
the dollar has pushed up the cost of imports from Europe and
Asia for Middle Eastern consumers. Yesterday's decision may make
it more difficult for Kuwait to meet a timetable to join five
other Gulf Arab monarchies in forming a single currency by 2010.


Read more at Bloomberg Currencies News

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