Qatar to launch riyal bonds

Qatar is set to issue its first local currency bond in an effort to diversify its funding away from the US dollar, foster a domestic bond market and widen its range of monetary policy tools, the country’s finance minister said on Sunday.

The central bank will announce the sale of Qatari riyal-denominated Islamic and conventional bonds to its domestic banks on either Monday or Tuesday, Yousef Kamal, Qatar’s finance minister, told the Financial Times. Bankers familiar with the plans estimated the size of the bond sale at QR4bn ($1.1bn, €895m, £760m).

Central bank officials have for some time been calling for a domestic bond programme to mop up excess liquidity in the banking system caused by government cash injections intended to shore up the sector as the global crisis struck.