|Euro / LP||1,778.47||1,776.94||0.09%||-3.29%|
|Euro / Dollar||1.1797||1.1787||0.09%||-3.29%|
Lebanese Forex Market To-date, the Lebanese Pound (LBP) remained steady within the official range of USD/LBP 1,514 to 1,514.5, with a mid- price of USD/LBP 1,514.25 in the week of July 30, 2021. This week, the Lebanese lira has somehow relaxed amid the political development by naming Najib Mikati to form a new government. As a result the Lebanese lira has improved on the black market and recorded around 18,500LBP/USD compared to over 22,000LBP/USD on last week. Noting that, this appreciation of Lebanese Lira against the dollar is not coming from solid economic and monetary reasons, as nothing has changed on these grounds, however it’s driven from a psychological aspect as some analyst believes that the government will be formed and eventually the situation will improve. In turn, the dollarization ratio for private sector deposits increased from 80.37% in December 2020 to 80.50% in May 2021. As for Euro/LBP currency pair, the Euro appreciated against the dollar-pegged LBP with the currency pair going from the past two week’s €/LBP 1,776.94 to €/LBP 1,778.47 by July 30, 2021. Moreover, the Nominal Effective Exchange Rate (NEER) of the LBP slightly decreased by 0.49% since 16 July 2021 to stand at 140.34 points on July 30 2021. International Forex Market The Euro/USD appreciated against the dollar from the past two week’s €/USD 1.1787 to €/USD 1.1797 by July 30, 2021. The US Dollar depreciated against the Euro amid the falling of US Treasury yields. The Fed’s has two difficult jobs, first to maintain a steady economic growth, second to control the inflation rate. However, this week witnessed a surge in corona virus cases which made the Fed’s monetary policy less effective and more difficult to influence positively the market. Commodities Gold price retreated by 0.12% at the end of this week to $1,824.31/ounce. However, we expect that the yellow metal will increase due to the escalating fears of the new Delta corona variant. In addition, Crude oil prices increased this week by 3.41% to reach $76.09/Barrel. In fact, maintaining a low production to keep the price up cannot survive for a long time, especially with the new variant of corona virus that will affect negatively the global demand for crude oil.