• Home
• /
• Business

Kuwait may revalue dinar against dollar

DUBAI - Kuwait may revalue the dinar after blocking foreign banks from trading its currency through local lenders to deter speculators, according to Standard Chartered Plc, whose third-biggest market is the Middle East.

The Central Bank of Kuwait may let the dinar appreciate against the dollar, Philippe Dauba-Pantanacce, a senior economist for Middle East and North Africa at the bank in Dubai, wrote in an investor report. The dinar was little changed at 0.266 per dollar as of 12:24 p.m. in Kuwait City.

Local banks were told that they may buy and sell currency from the central bank only for commercial purposes, according to three traders yesterday, who declined to be identified because they aren't authorised to comment publicly. Kuwait changes the value of the dinar every day depending on movements in a basket of currencies. The dollar is the largest component of the basket, which also includes the euro, yen and British pound. Local banks have been buying dinars from the central bank and selling them to international institutions to bet on the changes, the traders said. The speculation forces the central bank to buy dollars to keep the dinar at its chosen level.The dinar gained about 8.1 per cent against the dollar since it dropped its peg to the dollar in May last year.