Lebanese Forex Market
Demand for the dollar on the Lebanese forex market improved over the past week, where the value of the Lebanese pound against the dollar rose from a mid-price of $/LP 1,514 within the range of $/LP 1,513.75 -1,514.25 to a mid-price of $/LP 1,514.25 within the range of $/LP 1,514 -1,514.50.
Foreign assets (excluding gold) at the Central Bank increased 9.46% since the beginning of the year to $40.60B by September 2016, boosted by the recent swap executed by BDL with the MoF and Lebanese banks. The dollarization ratio of private sector deposits fell from 64.88% in December 2015 to 64.76% in August 2016.
By Friday the 21st of October 2016, the euro depreciated against the dollar-pegged LP over the last week, dropping from €/LBP 1,661.57 to €/LBP 1,640.16. As for the Nominal Effective Exchange Rate (NEER) of the LBP, it rose by 0.21% to reach 265.42 points.
International Forex Market:
The euro weakened this week as the European Central Bank kept its interest rates unchanged at record lows of zero and the deposit facility rate at -0.4%, which is the interest rate received by banks against depositing money at the Central Bank overnight. Hence, the euro depreciated against the dollar with the euro/dollar exchange rate dropping from €/$1.1022 to €/$1.088, this week.
Commodities:
Over the past week, gold prices rose from $1,249.58/ounce to $1,264.56/ounce this week.