Saudi Arabia Raises $11.5 Bln to Open 2026 Amid Strong Investor Demand

A general view of Riyadh, Saudi Arabia. (SPA)
A general view of Riyadh, Saudi Arabia. (SPA)
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Saudi Arabia Raises $11.5 Bln to Open 2026 Amid Strong Investor Demand

A general view of Riyadh, Saudi Arabia. (SPA)
A general view of Riyadh, Saudi Arabia. (SPA)

Saudi Arabia has successfully completed its first foray into international debt markets for 2026, issuing $11.5 billion in US dollar-denominated sovereign bonds. This move not only met financing needs but also became a global financial vote of confidence in the strength of the Kingdom’s economy.

The issuance attracted orders exceeding $31 billion, underscoring Saudi Arabia’s appeal as a safe and highly attractive destination for global institutional investors, as well as its ability to secure competitive pricing despite volatility in global monetary markets.

The bonds were covered 2.7 times, highlighting strong confidence in the trajectory of Vision 2030. Proceeds were distributed across four maturities ranging from three to 30 years, reflecting the Kingdom’s ability to build a stable, long-term yield curve.

The National Debt Management Center said the strong international demand reflects investors’ positive outlook on Saudi Arabia’s fiscal strength and non-oil growth prospects.

The issuance forms part of an annual borrowing plan targeting approximately $57.8 billion to finance the budget deficit and repay maturing debt, while maintaining debt at safe levels not exceeding 33 percent of the gross domestic product.

Saudi Arabia follows a conservative approach by fixing interest rates on 87 percent of its debt, shielding the budget from fluctuations in global borrowing costs and supporting the sustainability of capital spending on major projects, independent of swings in energy revenues.

The bonds were issued in four tranches. The first was $2.5 billion of three-year notes maturing in 2029. The second was $2.75 billion of five-year notes maturing in 2031. The third was $2.75 billion of 10-year notes maturing in 2036. The fourth was $3.5 billion of 30-year bonds maturing in 2056.

Reuters reported that initial price guidance for the three-year tranche was set at about 95 basis points over US Treasuries, while the five-year tranche was guided at around 100 basis points.

International Financing Review said initial guidance for the longer-dated tranches was about 110 basis points over Treasuries for the 10-year bonds and around 140 basis points for the 30-year bonds.

Annual borrowing plan

The National Debt Management Center said the issuance was carried out under the recently announced annual borrowing plan, which aims to diversify the investor base and meet the Kingdom’s financing needs from global debt markets efficiently and effectively.

It said the scale of international investor demand reflects confidence in the resilience of the Saudi economy and its future investment opportunities.

Saudi Finance Minister Mohammed Al-Jadaan approved the 2026 borrowing plan last week at around $57.8 billion, to cover a budget deficit of nearly $44 billion and repay about $13.9 billion in maturing debt during the year.

The issuance follows an active year for Saudi Arabia in bond markets, as it ranked among the world’s largest issuers in 2025 amid a surge in Middle East and North Africa issuance driven by rising financing needs and strong demand, including from Asian investors.

Under its 2026 financing strategy, Saudi Arabia relies on three main channels, led by private markets, alongside the domestic debt market and international markets.

The National Debt Management Center aims for riyal denominated sukuk to account for 25 to 35 percent of total funding, with international markets contributing 20 to 30 percent, with a particular focus on US dollar issuances. Private markets, including syndicated loans and export credit agency facilities, could account for up to 50 percent of total financing.

Strong financial management

Mohammed Farraj, chief asset management officer at Arbah Capital, said the successful coverage of Saudi Arabia’s first international issuance for 2026 reflects a high level of sovereign financial management and an advanced ability to deploy debt instruments to achieve national objectives.

He said the 2.7 times coverage ratio confirms deep international investor confidence in Saudi Arabia’s fiscal position and shows the Kingdom’s ability to price its credit risk at competitive levels close to those of advanced economies.

Farraj said the narrowing of spreads versus global benchmark bonds signals a lower risk premium, helping to reduce the overall cost of capital directed toward development and strengthening the position of Saudi sovereign assets as a stable and attractive investment within global portfolios.

He added that the move aligns with a proactive borrowing strategy aimed at neutralizing risks from monetary market volatility by locking in financing costs and securing liquidity for major projects ahead of any potential market pressures.

He said the strategy boosts budget flexibility and supports the sustainability of capital spending for Vision 2030 projects, away from economic cycle volatility or fluctuations in energy revenues, noting that public debt in this context is being redefined as a strategic tool to maximize returns from non oil growth and expand the productive base, rather than merely a means of covering deficits.

On funding diversification, Farraj explained that distributing issuance between conventional debt and Islamic sukuk across varied maturities improves the balance sheet structure, reduces refinancing risks and broadens the investor base geographically, limiting concentration risks in any single market.

Building a clear benchmark yield curve also supports the private sector’s ability to price its financing and sends positive signals to credit rating agencies about Saudi Arabia’s fiscal discipline, he added.

In international comparison, Farraj said Saudi Arabia’s public debt to GDP ratio remains among the lowest globally and within a range that ensures fiscal sustainability, compared with elevated levels in major advanced economies.

This gap shows Saudi borrowing is directed toward investment and growth, giving public finances flexibility to manage resources even if energy markets come under pressure, and reinforcing the Kingdom’s position as one of the world’s most stable and resilient economies in the face of global shocks, he stressed.



Dollar Set for Weekly Gain on Stalled US-Iran Talks and Middle East Uncertainty

US dollar banknotes (Reuters)
US dollar banknotes (Reuters)
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Dollar Set for Weekly Gain on Stalled US-Iran Talks and Middle East Uncertainty

US dollar banknotes (Reuters)
US dollar banknotes (Reuters)

The dollar was on track for its first weekly gain in three weeks on Friday in broadly muted trading, as stalled peace negotiations between the US and Iran dampened hopes for an immediate easing of Middle East tensions.

While Lebanon and Israel extended their ceasefire for three weeks ahead of its expiration on Sunday, Iran showed off its control over the Strait of Hormuz by releasing footage of its commandos storming a huge cargo ship, leaving the timing of the reopening of the world's most important shipping corridor uncertain and keeping oil prices elevated.

The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, slipped 0.1% to 98.75 but remained on track for a weekly gain of 0.5%. The euro was 0.1% higher at $1.169, Reuters reported.

Sterling edged 0.1% higher, with stronger-than-expected UK retail sales for March barely moving the needle.

"If you look at the last week the major theme is just that there's no real progression with peace talks. For markets, it's difficult when there's no deadline," said Tommy Von Brömsen, FX strategist at Handelsbanken in Stockholm.

Brent crude futures rose 1.5% to $106.60 a barrel.

The dollar has drawn safe-haven demand amid the uncertainty. It gained ground in March as concerns over the conflict deepened, but gave back some of those gains this month as optimism over a potential resolution grew.

"Oil and the dollar are still moving pretty closely together, and with crude creeping back up ... I'd say the dollar is still staying fairly firm," said Sho Suzuki, a market analyst at Matsui Securities.

Meanwhile, the yen was steady after four days of losses, rising 0.1% to 159.7 per dollar.

CENBANK BONANZA LOOMS

Traders are looking ahead to a central-bank-heavy week next week, with the Bank of Japan, European Central Bank, Bank of England and Federal Reserve among those due to deliver policy decisions.

"The main message from the central banks is that they are - so far at least - in a kind of 'wait-and-see' approach," said Handelsbanken's Von Bromsen.

He said the focus will be on communication and guidance, as market watchers assess how policymakers are digesting not just higher energy prices but the second-round effects of potentially higher inflation.

The European Central Bank will hold its deposit rate on April 30 but hike it in June, according to just over half of economists polled by Reuters, in a bid to protect a war-induced energy shock from knocking the euro zone economy off balance.

Meanwhile in Japan core consumer inflation slowed below the central bank's 2% target for a second straight month in March. Analysts, though, expect inflation to accelerate back above the Bank of Japan's target in coming months, as companies begin to pass on higher fuel costs from the Middle East conflict.

The BOJ is set to hold its two-day policy meeting ending on Tuesday. Reuters reported the bank is likely to hold off raising interest rates next week as fading prospects of a near-term end to the Middle East war keep the country's economic and price outlook highly uncertain. The BOJ is still expected to signal its readiness to hike to counter mounting price pressures.

Japanese Finance Minister Satsuki Katayama reiterated her verbal warning on intervention on Friday that authorities can take "decisive" action against speculative moves in the foreign exchange market, a day after saying Japan has a "free hand" to intervene and that past interventions had been effective.

The Australian dollar rose 0.1% versus the greenback to $0.7135. New Zealand's kiwi rose 0.1% to $0.5859.

In cryptocurrencies, bitcoin was little changed at $77,895.85.


Gold on Track for First Weekly Decline in Five as Iran War Drags On

One of two gold bracelets is displayed during a media presentation at the National History Museum of Romania in Bucharest, Romania, 21 April 2026.EPA/ROBERT GHEMENT
One of two gold bracelets is displayed during a media presentation at the National History Museum of Romania in Bucharest, Romania, 21 April 2026.EPA/ROBERT GHEMENT
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Gold on Track for First Weekly Decline in Five as Iran War Drags On

One of two gold bracelets is displayed during a media presentation at the National History Museum of Romania in Bucharest, Romania, 21 April 2026.EPA/ROBERT GHEMENT
One of two gold bracelets is displayed during a media presentation at the National History Museum of Romania in Bucharest, Romania, 21 April 2026.EPA/ROBERT GHEMENT

Gold prices fell on Friday and were on course for their first weekly decline after a four-week winning streak, as a US-Iran deadlock kept oil prices elevated and inflation concerns in focus.

Spot gold was down 0.2% at $4,683.23 per ounce at 0938 GMT, having hit its lowest point since April 13. It is down almost 3% so far this week. US gold futures for June delivery fell 0.5% to $4,699.

"Oil is going to be a pinch point in the Strait of Hormuz. It's going to remain elevated. And for sure, the decline in gold has mirrored the rally in oil," said independent analyst Ross Norman.

"The reality is gold is struggling to get upside momentum. When you can't breach the upside, you tend to attack the downside, and I think that's probably where we're at right now," Norman added.

Brent crude prices have risen about 18% so far this week and held above $105 a barrel, on concerns of a renewed military escalation in the Middle East and a lack of progress in re-opening the key waterway.

Higher crude oil prices can stoke inflation, increasing the likelihood that interest rates stay higher for longer.

While gold is often seen as an inflation hedge, elevated rates make yield-bearing assets more attractive, weighing on demand for non-yielding bullion, according to Reuters.

US President Donald Trump said he was in no rush to reach a peace agreement with Iran and wanted it to be "everlasting," while continuing to assert that the US had a clear upper hand in the naval stand-off in the strait.

Meanwhile, the dollar was on track for its first weekly gain in three weeks, while the benchmark 10-year US Treasury yields gained 2% this week.

On the physical demand side, gold premiums in India climbed to their highest in over two-and-a-half months this week, as supplies tightened, while buying interest picked up in China.

Spot silver fell 0.7% to $74.88 per ounce, platinum lost 1.4% to $1,978.84 and palladium gained 0.4% at $1,475.35.


Hapag-Lloyd Says One Ship Has Crossed Strait of Hormuz

Hapag-Lloyd employees monitor the status of cargo ships in the Strait of Hormuz on a screen, in Hamburg, Germany, Wednesday, April 15, 2026. (AP Photo/Ebrahim Noroozi)
Hapag-Lloyd employees monitor the status of cargo ships in the Strait of Hormuz on a screen, in Hamburg, Germany, Wednesday, April 15, 2026. (AP Photo/Ebrahim Noroozi)
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Hapag-Lloyd Says One Ship Has Crossed Strait of Hormuz

Hapag-Lloyd employees monitor the status of cargo ships in the Strait of Hormuz on a screen, in Hamburg, Germany, Wednesday, April 15, 2026. (AP Photo/Ebrahim Noroozi)
Hapag-Lloyd employees monitor the status of cargo ships in the Strait of Hormuz on a screen, in Hamburg, Germany, Wednesday, April 15, 2026. (AP Photo/Ebrahim Noroozi)

Container shipping group Hapag-Lloyd said on Friday that one of its ships has crossed the Strait of Hormuz but did not have any information on the circumstances or timing.

Four out of initially six ships remain in the Gulf, after one ship's charter agreement expired, meaning it no longer belongs to the Hapag-Lloyd fleet, a spokesperson added.

The four ⁠Hapag ships remaining ⁠in the Gulf are staffed with 100 crew, who are well-supplied with food and water, Reuters quoted him as saying.

Scores of tankers and other vessels remain stuck in the Gulf as the United States is ⁠struggling to keep control of the Strait of Hormuz, one of the world's busiest shipping corridors.

The Iran war, launched by the US and Israel on February 28, has been paused since a ceasefire on April 8.

The US and Iran met in Pakistan in an attempt to end hostilities, but talks ended without agreement and ⁠a ⁠second round has yet to take place.

Tehran says it will not consider opening the strait until the US lifts its blockade of Iran's shipping, which Washington imposed during the ceasefire and Tehran calls a violation of that truce.

This week, Iran flaunted its grip over the strait with a video of commandos in a speedboat storming a huge cargo ship.