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NEOM Kicks off Work on First Phase of Residential Complexes

Visitors watch a 3D presentation during an exhibition on NEOM in Riyadh, October 25. (Reuters)
Visitors watch a 3D presentation during an exhibition on NEOM in Riyadh, October 25. (Reuters)
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NEOM Kicks off Work on First Phase of Residential Complexes

Visitors watch a 3D presentation during an exhibition on NEOM in Riyadh, October 25. (Reuters)
Visitors watch a 3D presentation during an exhibition on NEOM in Riyadh, October 25. (Reuters)

The NEOM company on Tuesday started construction work on the first phase of residential complexes dedicated to project workers’ housing. The first phase will house 30,000 workers who will be moving to NEOM to develop different areas of the project.

Building work kicked off with the attendance of NEOM Chief Executive Nadhmi al-Nasr as well as heads of the two Saudi companies who won contracts for the construction of the complexes, Al-Tamimi Group and Saudi Arabian Trading & Construction Co. ( SATCO).

The contracts allow the companies to operate the housing for 10 years. This is considered the first investment opportunity listed by NEOM.

Nasr urged developers to focus on the local content and increase the quantity of manufactured products and inputs in Saudi Arabia in support of the local economy and in tandem with the Saudi approach to boost local content in giant projects.

This meets guidelines of NEOM board of directors, chaired by Crown Prince Mohammed bin Salman, Deputy Prime Minister and Minister of Defense.

NEOM Chief Executive demanded firms to create job opportunities to residents of NEOM, pledging to back these firms in all means to achieve human development.

The residential region consists of several complexes in which Al-Tamimi Group has contracts to build two residential complexes with each fitting to 10,000 workers, while SATCO would construct a similar complex with the same capacity.

The project workers’ housing would provide a life-pattern that seeks to prepare an adequate business environment that goes in tandem with the goals of NEOM and the best world practices.

NEOM is located in an area of about 26.5 thousand square kilometers in the north-west of the kingdom. The project would be a pillar of economic transformation within Saudi Vision 2030 to provide various income sources through NEOM economic sectors and real estate investments.

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Firm Dollar Keeps Pound, Euro and Yen Under Pressure

US Dollar and Euro banknotes are seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/ File Photo
US Dollar and Euro banknotes are seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/ File Photo
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Firm Dollar Keeps Pound, Euro and Yen Under Pressure

US Dollar and Euro banknotes are seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/ File Photo
US Dollar and Euro banknotes are seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/ File Photo

The US dollar charged ahead on Thursday, underpinned by rising Treasury yields, putting the yen, sterling and euro under pressure near multi-month lows amid the shifting threat of tariffs.

The focus for markets in 2025 has been on US President-elect Donald Trump's agenda as he steps back into the White House on Jan. 20, with analysts expecting his policies to both bolster growth and add to price pressures, according to Reuters.

CNN on Wednesday reported that Trump is considering declaring a national economic emergency to provide legal justification for a series of universal tariffs on allies and adversaries. On Monday, the Washington Post said Trump was looking at more nuanced tariffs, which he later denied.

Concerns that policies introduced by the Trump administration could reignite inflation has led bond yields higher, with the yield on the benchmark 10-year US Treasury note hitting 4.73% on Wednesday, its highest since April 25. It was at 4.6709% on Thursday.

"Trump's shifting narrative on tariffs has undoubtedly had an effect on USD. It seems this capriciousness is something markets will have to adapt to over the coming four years," said Kieran Williams, head of Asia FX at InTouch Capital Markets.

The bond market selloff has left the dollar standing tall and casting a shadow on the currency market.

Among the most affected was the pound, which was headed for its biggest three-day drop in nearly two years.

Sterling slid to $1.2239 on Thursday, its weakest since November 2023, even as British government bond yields hit multi-year highs.

Ordinarily, higher gilt yields would support the pound, but not in this case.

The sell-off in UK government bond markets resumed on Thursday, with 10-year and 30-year gilt yields jumping again in early trading, as confidence in Britain's fiscal outlook deteriorates.

"Such a simultaneous sell-off in currency and bonds is rather unusual for a G10 country," said Michael Pfister, FX analyst at Commerzbank.

"It seems to be the culmination of a development that began several months ago. The new Labour government's approval ratings are at record lows just a few months after the election, and business and consumer sentiment is severely depressed."

Sterling was last down about 0.69% at $1.2282.

The euro also eased, albeit less than the pound, to $1.0302, lurking close to the two-year low it hit last week as investors remain worried the single currency may fall to the key $1 mark this year due to tariff uncertainties.

The yen hovered near the key 160 per dollar mark that led to Tokyo intervening in the market last July, after it touched a near six-month low of 158.55 on Wednesday.

Though it strengthened a bit on the day and was last at 158.15 per dollar. That all left the dollar index, which measures the US currency against six other units, up 0.15% and at 109.18, just shy of the two-year high it touched last week.

Also in the mix were the Federal Reserve minutes of its December meeting, released on Wednesday, which showed the central bank flagged new inflation concerns and officials saw a rising risk the incoming administration's plans may slow economic growth and raise unemployment.

With US markets closed on Thursday, the spotlight will be on Friday's payrolls report as investors parse through data to gauge when the Fed will next cut rates.