Lebanese Forex Market
The Lebanese Pound traded within the range of $/LP 1,514-1,514.5 against the dollar with a mid-price of $/LP 1,514.25 by the week ending June 22nd, at the same range as last week.
The peg continues to be supported by the Central Bank’s solid foreign assets, which reached $45.3 billion in May 2018.
The dollarization ratio of private sector deposits grew from 65.84% in December 2017 to 68.32% in April 2018.
Over the past week, the Euro shed to its 2018 lows against the dollar-pegged LP going from €/LBP 1,782.47 to €/LBP 1,758.95 this week.
As for the Nominal Effective Exchange Rate (NEER) of the LBP, it recorded a 0.98% weekly progress to 114.57 points.
International Forex Market
Even though positive economic news from Europe marked the end of this week and concerns over an escalation of the trade dispute between China and the US overshadowed the global sentiment, the greenback managed to recover some of its previous losses and hit an 11-month high on Thursday. This was mainly supported by investors’ expectations of an extended period of divergence between the monetary policies of the Federal Reserve and European Central Bank (ECB). The appointment of two eurosceptics by the Italian government to head the key-finance committees was another reason for the Euro to weaken over the week. As a result, the euro dropped against the dollar by a weekly 1.32% increase to settle at 1.1668 on Friday June 22, 2018.
Commodities
Gold prices dropped this week from $1,311.80 to $1,270 by the week ending June 22.