A Trilateral Defence Pact Signed in Mecca, and Two Pegs That Priced Nothing

Friday's session closed with the two Gulf pegs exactly where they opened, exactly where they opened yesterday, and exactly where they will open on Sunday: USD/SAR at 3.7500, USD/AED at 3.6725. The rolling range on either pair this week is measured in fractions of a pip, which is another way of saying there is no range at all. This matters because the news flow around it was not quiet.

Riyadh, Ankara and Islamabad signed a joint defence pact this week — reported in some coverage under the label…