Lebanese Forex Market
The Lebanese Pound (LP) remained steady within the official range of $/LP 1,514 – 1,514.5 against the dollar, with a mid-price of $/LP 1,514.25 by the week ending March 13th 2020.
The peg also continues to be supported by the Central Bank’s total foreign assets, which settled at $35.75B in Mid-March 2020.
In turn, the dollarization ratio of Private sector deposits surged to 76.70% in January 2020, up from 70.87% recorded during the same period in 2019.
Across the week, the Euro depreciated vis-à-vis the dollar-pegged LP as the currency pair went from last week’s €/LBP 1,677.5 to this week’s €/LBP 1,618.26. In turn, the Nominal Effective Exchange Rate (NEER) of the LP added 3.06% to reach 123.59 points by the week ending March 2020, 2020.
International Forex Market
The Euro/USD currency pair went from last week’s €/USD 1.1128 to €/USD 1.0735 by March 20. In detail, the US Dollar (USD) surged this week despite the recent burst of liquidity injection operations undertaken by central banks around the world. In fact, companies and investors sought out the most liquid currency on concerns about economic shutdowns from the global spread of the coronavirus.
In the UK, The pound has fallen to its lowest level against the dollar since 1985 as the coronavirus outbreak continues to rip through global markets. On Wednesday, the pound traded below $1.15 against the dollar for the first time since the 1980s, extending a decline over the past week. The pound’s weakness could be related, among other things to the uncertainty over how the UK government plans to pay for the emergency economic measures it has introduced.
Commodities
Although Gold is considered to be a safe-haven, its prices slipped this week with the coronavirus pandemic threatening to cripple economic activity and prompting investors to sell assets to keep their money in cash. In details, international gold prices retreated by a weekly 6.79% to $1,469.80/ounce by March 19.