Euro to Riyal: Comprehensive Analysis and Economic Impacts in Saudi Arabia

The exchange rate of the Euro to the Saudi Riyal represents the amount an individual or company pays in Riyals to obtain one Euro. This rate reflects the dynamics between the European Union currency (Euro) and the currency of the Kingdom of Saudi Arabia (Riyal). In the Saudi financial market, there is no direct trading of the Euro/Riyal pair on the Tadawul platform; however, fluctuations in this pair affect many companies, especially those with trade dealings with Europe or obligations or investments in Euros. The Riyal is pegged to the US dollar at a fixed rate (3.75 Riyals per dollar), making movements of the Euro against the Riyal a reflection of movements of the Euro against the dollar. If the Euro rises against the dollar, it automatically rises against the Riyal, and vice versa. This linkage enhances the stability of the Riyal but makes the local economy sensitive to changes in European monetary policy and major economic events in the Eurozone. Saudi companies that rely on importing goods or services from Europe closely monitor this rate, as it affects their purchasing costs and revenues in the case of exports. Thus, "Euro to Riyal" is not just a number in exchange rate tables; it is a measuring tool for the impact of global changes on the Saudi economy.

The exchange rate of the Euro to the Saudi Riyal is almost entirely dependent on the Euro to US dollar (EUR/USD) exchange rate, due to the Riyal's fixed peg to the dollar. If the Euro rises against the dollar due to economic or political factors in the Eurozone, this will directly reflect on the Euro to Riyal exchange rate. Conversely, if the Euro weakens against the dollar, its price against the Riyal decreases. This linkage makes the Saudi Riyal a relatively stable currency and reduces exchange rate volatility compared to other currencies that follow a free-floating system. For example, if the Euro to dollar exchange rate is 1.10, and the dollar is fixed at 3.75 Riyals, the Euro to Riyal exchange rate would be 1.10 × 3.75 = 4.125 Riyals. The Saudi Arabian Monetary Authority (SAMA) intervenes to maintain this stability by managing foreign currency reserves and monetary policies. Hence, understanding the relationship between the Euro and the dollar becomes the key to understanding movements of the Euro to Riyal exchange rate, especially for investors and commercial traders.

During the years 2024 and 2025, the exchange rate of the Euro to the Saudi Riyal showed relative stability, ranging between 4.20 and 4.35 Riyals per Euro. By the end of November 2025, the average rate reached approximately 4.32 Riyals. The two years experienced slight fluctuations, reflecting movements of the Euro against the dollar more than any local Saudi factors, due to the stability of the Riyal against the dollar. At the beginning of 2024, the rate was around 4.25 Riyals, dropping to below 4.20 Riyals at some points in 2025, before rising again by the fall to 4.30-4.35 Riyals. These slight changes in the exchange rate indicate a stable environment for the Saudi economy, supported by stable oil prices and strong performance in the local stock market, where the general index of the Saudi financial market recorded approximately 11,010.63 points by the end of November 2025. This stable environment contributed to reducing exchange rate volatility, despite global changes in currency prices and oil markets.

The Euro to Riyal exchange rate affects multiple aspects of the Saudi economy, most notably foreign trade, the cost of imports from Europe, and the returns on Saudi investments in the Eurozone. When the Euro strengthens against the Riyal, the cost of importing European goods and services rises, which may lead to increased prices for imported products and reduced profit margins for Saudi companies relying on European production inputs. Conversely, Saudi companies exporting their products to Europe may benefit from a stronger Euro, as their revenues increase when converted to Riyals. Additionally, fluctuations in the exchange rate impact both public and private Saudi investments in European assets, as the value of these assets increases when the Euro rises and decreases when it falls. Given that the Saudi economy heavily relies on oil exports priced in dollars, the impact of Euro fluctuations remains limited compared to the influence of the dollar; however, the increasing investments and trade relations with Europe in recent years make monitoring this currency pair important for both the public and private sectors.

Several key factors determine the fluctuations of the Euro to Riyal exchange rate, including: 1) The monetary policy of the European Central Bank (ECB) and the US Federal Reserve (Fed), where decisions to raise or lower interest rates directly affect the Euro to dollar exchange rate, and thus the Euro to Riyal rate; 2) Inflation rates and economic growth in the Eurozone, where periods of strong growth or high inflation may strengthen or weaken the Euro; 3) Global oil prices, which affect Saudi cash reserves and the level of demand for the Riyal; 4) Political and economic crises in Europe or Saudi Arabia; 5) Changes in the balance of payments and foreign trade between Saudi Arabia and EU countries. All these factors interact to determine the price trajectory, but the stability of the Riyal against the dollar makes external factors related to the Euro the most influential.

The monetary policies of the European Central Bank (ECB) and the Saudi Arabian Monetary Authority (SAMA) play a crucial role in determining the stability of the Euro to Riyal exchange rate. The ECB adjusts interest rates and asset purchase programs to control inflation and support economic growth in the Eurozone. When the ECB raises interest rates, the Euro typically strengthens against other currencies, including the Riyal. In Saudi Arabia, SAMA adheres to a policy of pegging the Riyal to the dollar, and Saudi interest rates often move in line with the decisions of the US Federal Reserve. This peg reduces fluctuations of the Riyal against other currencies, but it makes the Saudi economy more sensitive to changes in monetary policy in both the US and the Eurozone. In recent years, these policies have contributed to maintaining a relative stability of the Euro to Riyal exchange rate, despite global changes.

Listed Saudi companies in the Tadawul market are affected by the Euro to Riyal exchange rate, especially those operating in import and export sectors or having investments in Europe. Petrochemical companies, manufacturing industries, the automotive sector, and food and beverage companies that import components or equipment from Europe are directly affected by changes in the exchange rate, as a rising Euro increases import costs in Riyals, potentially impacting profit margins. Conversely, companies exporting their products to Europe may benefit from a stronger Euro, as their revenue value increases when converted to Riyals. Currency fluctuations also affect sovereign wealth fund investments and major Saudi companies in European assets. For this reason, financial risk management departments in Saudi companies closely monitor movements of the Euro to Riyal exchange rate and employ hedging strategies when necessary.

In addition to the Euro, there are other major currencies that influence the Saudi market, most notably the US dollar (USD), British pound (GBP), Swiss franc (CHF), Japanese yen (JPY), and UAE dirham (AED). The US dollar is the reference currency for Saudi Arabia due to the stability of the Riyal against it, while the British pound and Swiss franc are strong currencies in international trade and investments. Movements of these currencies against the Riyal are often linked to their changes against the dollar. On the other hand, some Saudi companies rely on the Japanese yen for transactions with Japan and the UAE dirham for transfers within the Gulf region. Nevertheless, the Euro remains the second most important reserve and trading currency after the dollar in the Saudi market, so its movements are closely monitored by financial institutions and commercial traders.

The period between 2024 and 2025 witnessed a series of global and local events that impacted the Euro to Riyal exchange rate. Among the most notable were: the continued policy of raising interest rates by the ECB to combat inflation, fluctuations in global oil prices around $60-70 per barrel, and the continued stability of the Saudi monetary system. Geopolitical tensions in Europe (such as the Ukrainian crisis) also affected currency markets, prompting global investors to hedge against Euro fluctuations. Locally, Saudi Arabia maintained its cautious monetary policy and continued issuing international bonds in Euros to finance major projects, enhancing the liquidity of the Euro in the local market. Collectively, these events contributed to a relative stability of the exchange rate, with limited fluctuations linked to changes in global markets.

Saudi banks play a key role in trading and converting Euro to Riyal, both for individuals and companies. Major banks such as the National Commercial Bank, Al Rajhi Bank, and Saudi British Bank (SABB) offer services for opening Euro accounts, currency conversion, and financing foreign trade with Europe. Exchange rates are determined daily based on global prices and directives from the Monetary Authority. Banks also provide hedging services for large companies wishing to protect themselves from exchange rate fluctuations. With the absence of a direct Forex market within the Tadawul platform, financial institutions resort to partnerships with international banks or foreign brokerage firms to conduct large transfers or risk management operations. These mechanisms ensure liquidity and transparency for clients, while adhering to strict regulatory controls.

The Tadawul platform currently does not allow direct trading of foreign currencies, including the Euro/Riyal pair. Trading in the local market is limited to stocks, sukuk, bonds, and some government debt instruments. Currency conversion and trading are only available through local banks and licensed exchange companies. For investors wishing to gain exposure to the Euro rate, they can invest in funds or financial instruments linked to European assets or conduct transfers through banks. Active trading of the Euro/Riyal pair (as in global Forex markets) is only available through external platforms and is subject to the regulations and oversight of regulatory bodies outside the Kingdom. It is always important to ensure dealing with licensed financial institutions to avoid risks associated with foreign currency trading.

Saudi Vision 2030 aims to diversify the Saudi economy, increase foreign investments, and enhance trade relations with Europe. This policy is reflected in the rise in trade and investment exchanges between the Kingdom and Eurozone countries, increasing the importance of monitoring the Euro to Riyal exchange rate. Saudi government and private investments in Europe, along with the Kingdom's issuance of Euro-denominated bonds, all enhance the liquidity of the Euro in the local market. In the long term, the success of Vision 2030 may lead to greater financial flows between Saudi Arabia and Europe, making the Euro/Riyal exchange rate a more significant indicator for the national economy. However, the impact of these policies remains gradual and depends on the stability of the Saudi monetary system and the continued peg of the Riyal to the dollar.

Oil prices play a pivotal role in the stability of the Saudi Riyal, and thus in determining the value of the Euro against the Riyal. When oil prices rise, the Kingdom's revenues from foreign currency increase, enhancing cash reserves and giving the Monetary Authority greater capacity to stabilize the exchange rate. In recent years, oil prices have maintained moderate levels (around $60-70 per barrel), contributing to the stability of the Riyal and the Euro/Riyal exchange rate. Conversely, any sharp decline in oil prices may exert pressure on cash reserves and increase the Riyal's sensitivity to fluctuations in foreign currencies. For this reason, financial institutions and investors closely monitor oil prices when analyzing movements of the Euro to Riyal exchange rate.

Many investors and economic observers seek answers to frequently asked questions regarding the Euro to Riyal exchange rate, including: What is the current exchange rate? Why is the Riyal pegged to the dollar? How does the price change affect trade and investment? Where can Euro be converted or traded in Saudi Arabia? What is the difference between the impact of other foreign currencies? These questions will be addressed in detail in the FAQ section later in this article, focusing on providing neutral educational answers that comply with the regulations of the Saudi Capital Market Authority.