Lebanese Forex Market
The 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.
The peg continues to be supported by the Central Bank’s solid foreign assets, which were further replenished to reach $38.7B by August 2019, which is mainly attributed to BDL’s end-July initiative that aimed to boost investors’ confidence in Lebanon by re-incentivizing commercial banks to attract fresh dollars as deposits.
The dollarization ratio of private sector deposits increased slightly from 70.62% in Dec. 2018 to 71.73% in July 2019.
It’s worthy to note that the average interbank rate stood at 12% by Sept.19th, compared to last week’s 5%.
The Euro appreciated against the dollar-pegged LP to end the week at €/LBP 1,658.76 compared to last week’s €/LBP 1,671.71. As for the Nominal Effective Exchange Rate (NEER) of the LBP, it slipped by a weekly 0.35% to stand at 118.84 points.
International Forex Market
The Euro/USD currency pair stood at €/USD 1.1003 by Sept. 20th, down from last week’s €/USD 1.1089. Over the week, the US dollar fluctuated, noting it slipped post-FED’s decision to cut interest rates by a quarter point this week. However, the dollar gained grounds later in the week, appreciating on prospects of investors’ heightened concerns regarding slower global growth prospects and political tensions, especially between Iran and the US.
In turn, international gold prices fell from last week’s $1502.8/ounce to $1,501.7/ounce this week.