Lebanese Forex Market:
Demand for the Lebanese Pound in the Lebanese Forex market weakened versus the Dollar during the week with the exchange rate moving within the peg range from $/LP 1,507–1,511 with a mid-price of $/LP 1,509 to $/LP 1,508–1,512 with a mid-price of $/LP 1,510. Foreign assets (excluding gold) at the Central Bank dropped by a monthly 0.57% to reach $38.59B at the end of August. As for the dollarization rate of private sector deposits, it slid from 65.71% in December 2014 to 65.08% by June.
By Friday 18th of September, 2015, 11:30 pm Beirut time, the dollar-pegged LP depreciated against the euro going from €/LP 1,702.27 to €/LP 1,725.94. The Nominal effective exchange Rate (NEER) shed a weekly 0.62% to 166.07 points, narrowing its year-to-date gains to 12.73%.
International Forex Market:
The euro appreciated by 1.39% against the dollar to €/$ 1.1449 following less that encouraging U.S. consumer price index (CPI) data which led to speculation that the Fed won’t hike interest rates this month, rather in December. In fact, the Central Bank of the United States decided against raising interest rates, on September 17th, until the turn of the year, as both criteria for the hike weren’t met. In specifics, despite the reached goal of 5% unemployment rate by August, the 2% inflation rate wasn’t achieved. Actually the CPI declined by 0.1% in August after a 0.1% increase in July.
Commodities:
Gold started to show bullish movement on the 15th of September mainly on the back of poor U.S. inflation figures, illustrating that the economy is not at its best at the moment and that the Fed will most probably delay its rate hike. Hence, the price of gold augmented by a weekly 2.77% to reach $1,136.68/once at 12:30 pm Beirut time.