Weaker Dollar on Dovish Fed Statement

Lebanese Forex Market:

Demand for the Dollar in the Lebanese Forex Market remained unchanged over the past week as the value of the dollar steadied at $/LP 1,513.75-1,514.25 with a mid-price of $/LP 1,514.

Foreign assets (excluding gold) of the Central Bank increased 0.59% since the beginning of the year to $37.31B by May 2016. The dollarization ratio of private sector deposits fell from 64.88% in December 2015 to 64.73% in April 2016.

By Friday 10th of June, 2016, 1:23 pm Beirut time, the euro appreciated against the dollar-pegged LP as the exchange rate rose by 1.37%, over the last week, rising from €/LP 1,680.71 to €/LP 1,703.78. As for the Nominal Effective Exchange Rate (NEER), it lost a weekly 0.57% to 166.19 points, registering a 1.31% year-to-date decrease.

International Forex Market:

The dollar lost momentum over the past week given Janet Yellen’s statement that the Federal Reserve will wait for the economic picture to be less mixed before hiking interest rates.

Commodities:

Given the weaker dollar, the gold prices edged higher from $1,236.52/ounce at last Friday to $1,269.86/ounce this week.

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