Qatar’s currency, the riyal, touched a new low against the dollar on Tuesday as the country’s diplomatic crisis continued.
The riyal hit 3.67 to the dollar, which is the weakest since 1998, the Financial Times reported.
Qatar’s central bank has pegged the currency to 3.64 to the dollar so even small movements are likely to produce new lows.
Qatar’s finances have come under pressure in the wake of a diplomatic row with its Gulf neighbours.
Last week credit rating agency S&P cut its long-term rating of Qatar one notch from AA to AA- late and implied that further downgrades were likely.
Qatar’s neighbours, including Saudi Arabia, the United Arab Emirates, Bahrain and Egypt, cut diplomatic and trade ties with the country, accusing it of supporting terrorist groups such as the Islamic State and Al-Qaeda. Qatar has denied the allegations.
The Qatari stock market has tumbled around 9% since the announcement and its currency, the riyal, has fallen to an 11-year low.
Here is how the chart looks, showing that it now takes more riyals to buy a dollar:
The currency has come under attack despite attempts by Qatari Finance Minister Ali Shareef Al Emadi to calm the situation.
“We have the assets and the security that we need. Our foreign assets and our foreign investment is more than 250% of our GDP. So we are very much comfortable. We know we can defend the currency or we can defend the economy,” he said in an interview with CNBC on Monday. “But I don’t think there’s anything that we need to worry about in the local economy.”