Lebanese Forex Market
Demand for the local currency on the Lebanese forex market steadied with the value of the Lebanese Pound trading within the range of $/LP 1,513 – 1,514 with a mid-price of $/LP 1,513.5. Meanwhile, BDL’s foreign assets stood at $41.9B by December 2017.
The dollarization ratio of private sector deposits rose from 65.82% in December 2016 to 68.51% by the end of November 2017.
Over the past week, the Euro appreciated against the dollar-pegged LP going from €/LBP 1,832.09 on January 12 to €/LBP 1,859.89 on January 19, 2018.
As for the Nominal Effective Exchange Rate (NEER) of the LBP, it fell from 110.5 points last week to 109.54 points this week.
International Forex Market
During the week, US dollar weakened as investors weighed the likelihood of a government shutdown in the US. This was coupled by a rise in the euro which was fueled by growing expectations that the European Central Bank will tighten its monetary policy. Consequently, a stronger euro increased investors’ appetite to rebalance their portfolios towards euro stock. As such, the Euro-Dollar exchange rate rose from 1.2153 a week ago to 1.2338 this week.
Gold prices rose from $1,331.42/ounce last week to $1,332.80/ounce this week.