Euro Gained Momentum Upon Lagarde’s First Policy Meeting as new ECB President

Lebanese Forex Market

The Lebanese Pound (LP) continues to steady within the range of $/LP 1,514 – 1,514.5 against the dollar, with a mid-price of $/LP 1,514.25 this week.

The peg continues to be supported by the Central Bank’s solid foreign assets, which were further replenished to reach $38.1B by November 2019.

The dollarization ratio of private sector deposits increased from 70.62% in Dec. 2018 to 73.43% in October 2019.

The Euro appreciated against the dollar-pegged LP, going from last week’s €/LBP 1,670.2 to €/LBP 1,682.47 this week. As for the Nominal Effective Exchange Rate (NEER) of the LBP, it retreated by 0.54% to 117.55 points by the week ending Dec. 13th 2019.

International Forex Market

By December 13th, the Euro/USD currency pair climbed from €/USD 1.1079 last week, to €/USD 1.1161. Over the week, the US dollar fluctuated. Demand on the dollar strengthened partly as Trump decided not to slap new tariffs on Chinese goods by the deadline of Dec. 15th, despite a non-finalized phase 1 deal between the US and China. However, the dollar weakened on account of data published by the US Census Bureau revealing the USA’s monthly retail sales climbed by a modest 0.2% increase to $528B in November, below markets expectations of a 0.5% uptick. Moreover, the FED maintained its benchmark rate in the range of 1.5% -1.75% on Wednesday, which also weakened demand on the usd.  

Meanwhile, the Euro shot up on the eve of the first policy meeting by Christine Lagarde, the European Central Bank’s (ECB’s) new president


International gold prices climbed by a marginal 0.8% this week to $1,472/ounce by the week ending December 13th 2019.

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