From: jeffrey E. <jeevacation@gmail.com>
Sent: Thursday, November 5, 2015 11:28 PM
To: Jabor Y.
Subject: Re: Fwd: Saudi rates and CDS
I m glad , was she helpful ? if possible=i would like to take you up on the offer to fly with you to paris.=C2 sat is fine.
just me am
=div class="gmail_extra">
On Thu, Nov 5, 20=5 at 5:45 PM, labor Y. wrote:
Thanks my friend Jennie was soo=nice
On 5 Nov 2015 10:51 am, "jeffrey E." &=t;jeevacation@g=ail.com <mailto:jeevacation@gmail.com> wrote:
S&P cut Saudi Arab=a from A+ to AA- earlier this week as they expect the fiscal deficit will =ncrease to 16% of
GDP in 2015, from 1.5% in 2014, primarily reflecting the=sharp drop in oil prices As a follow-up to the below, it is also
interesting to look at playi=g the idea through FX.
4=pan>
USD/SAR is currently p=gged. While our base case is that the government will defend the peg, if h=adlines get
worse, revenues collapse from depressed oil prices and the gov=rnment has to address fiscal spending, we believe
forward points and volatility will continue to increase. Althou=h, it may be a low probability event that the government
breaks the peg, i= we look at Kazakhstan's actions in August (see chart below), we s=e buying USD call/ SAR put options
as an interesting risk reward.
</=pan>
USD/KZT lyr</=>
Source: Bloomberg 11/0=12015
Chart 2 below shows Saudi CDS
1
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Syr Saudi CDS
please =ote
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