London- Around $6 billion left Qatar over June, Qatar Central Bank Governor Sheikh Abdullah Bin Saoud al-Thani said, affirming that the Qatari riyal will continue to be pegged to the US dollar in the future.
His statements were made during an interview with CNBC, amidst the Qatari crisis and the boycott of Saudi Arabia, Egypt, UAE and Bahrain.
Qatari stocks have weakened and the Qatari riyal has been volatile in the spot market since the four Arab states cut diplomatic and transport ties with Qatar on June 5, accusing it of backing terrorism.
Crisis consequences also resulted in the Rating agency Moody’s Investors Service changing the outlook to negative from stable for several economic sectors, including banks and a number of state-institutes based on economic and financial risks ensued from the ongoing dispute.
Qatar Central Bank Governor added that the central bank has $40 billion in reserves, while the Qatar Investment Authority sovereign wealth fund has $300 billion in reserves that it could liquidate.
Qatar’s banking sector still has significant dependence on foreign funding – thirty-six percent of commercial banks’ total liabilities in May were to foreigners, including others in the six-nation Gulf Cooperation Council (GCC).
Saudi, UAE and Bahraini banks have already largely frozen new business with Qatar because of guidance from their central banks; some jittery foreign banks have followed suit.