Saudi Foreign Reserves Drop for Fourth Month to $672 Billion

Saudi Arabia’s foreign reserve assets fell for a fourth month to about $672 billion as the kingdom grapples with lower oil prices and the costs of Yemen’s war, though the pace of the drop slowed.

Net foreign assets fell about 24.7 billion riyals ($6.6 billion) in May, bringing their decline since January to more than $50 billion, the Saudi Arabian Monetary Agency said in its monthly report. The reserves had plunged by 180 billion riyals in the previous three months.

King Salman, who came to the throne in January, has started a bombing campaign against rebels in Yemen and moved ahead with domestic spending plans, prompting the International Monetary Fund to predict a budget deficit this year of 20 percent of economic output.

The government is using its deposits at the central bank to finance the shortfall, though analysts say it may soon turn to bond sales.