Bloomberg: Oil Slide Echoes 2008 Peg Pressure for Nigeria to Saudi

The sharpest drop in oil prices since 2008, coupled with a surge in the dollar, are testing the resolve of energy-producing nations to defend their currency pegs.

Even Saudi Arabia, whose $745 billion reserves may allow it to maintain the link for years, is feeling the pressure of speculators betting against its currency. Nigeria intervened in foreign-exchange markets to bring the naira back from a record low last week, while economists surveyed by Bloomberg expect Venezuela to capitulate on its dollar peg by year-end.

For the dwindling number of nations whose exchange rates are linked to either dollars or a basket of major currencies, breaking those ties would raise the odds of inflation accelerating too fast. It would also take away a steadying influence on their economies.
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