he Lebanese Pound (LP) steadied during the past week within the range of $/LP 1,514 – 1,514.5 against the dollar, with a mid-price of $/LP 1,514.25.
Lebanese Forex Market
The peg continues to be supported by the Central Bank’s solid foreign assets, which stood at $36.39B by end-June 2019.
The dollarization ratio of private sector deposits increased slightly from 70.62% in Dec. 2018 to 71.22% in May 2019. As for the average interbank rate it stood at 6.05% in July compared to 6.8% last week.
The Euro depreciated against the dollar-pegged LP, ending the week at €/LBP 1,689.47, compared to last week’s €/LBP 1,695.97. As for the Nominal Effective Exchange Rate (NEER) of the LBP, it retreated by a weekly 0.08% to stand at 118.19 points.
International Forex Market
The Euro/USD currency pair went from last week’s €/USD 1.1250 to €/USD 1.1207 in the week ending July 19th. The dollar extended its loss over this week as well, with the IMF’s statement regarding the US dollar being “overvalued by 6% to 12%”, amid bets that the FED will lower interest rates in two weeks’ time while markets expect the ECB to cut interest rates and adjust its inflation goals.
Accordingly, gold prices climbed from $1,408.40/ounce last week to $1,440/ounce in the week ending July 19th 2019.