Lebanese Forex Market:
Demand for the Lebanese Pound in the Lebanese Forex market strengthened versus the Dollar during the week ending October 9, 2015 with the exchange rate moving within the peg range from $/LP 1,509–1,513 with a mid-price of $/LP 1,511 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 0.89% to reach $38.25B at the end of September 2015. As for the dollarization rate of private sector deposits, it slid from 65.71% in December 2014 to 64.96% by August this year.
By Friday 9th of October, 2015, 15:30 pm Beirut time, the dollar-pegged LP depreciated against the euro going from €/LP 1,683.12 one week earlier to €/LP 1,706.94, representing a 1.42% increase. The Nominal effective exchange Rate (NEER) decreased by 0.70% to 166.22 points, narrowing its year-to-date gains to 12.83%.
International Forex Market:
On the US front, mixed economic data came out this week which kept the dollar at a topsy turvy state. In details, better than expected jobless claims was offset by ISM (Service Sector Index) and Non-Farm Payrolls (NFP) data, which were lower than expected in the U.S. during September. The Dollar’s descent was accentuated by the latest Federal Reserve minutes of meeting, which was released on Thursday. The report mainly illustrated the dovish attitude of the Fed during the meeting on September 17th. Accordingly, over the past week, the Euro appreciated by 1.48% against the dollar to €/$ 1.1323.
Commodities:
Gold improved during the week mainly on the back of a weak Dollar, and investors remaining “on the fence” in regards to the latest Fed’s minutes of meeting. Hence, the price of gold increased by a weekly 3.95% to reach $1,153.83/ounce at 15:30 pm Beirut time.