| 05/09/2014 | 29/08/2014 | %Change | YTD | |
| Euro / LP | 1,952.66 | 1,988.54 | -1.80% | |
| Euro / Dollar | 1.2953 | 1.3191 | -1.80% | |
| NEER Index** | 134.97 | 134.03 | 0.70% | 4.58% |
Mounting demand for the dollar was experienced over the prior week as mirrored by the Lebanese pound’s peg against the dollar that went from $/LP 1,505-1,509 with a mid-price of $/LP 1,507, last week, up to 1,510-1,514 with a mid-price of $/LP 1,512. Foreign assets (excluding gold) at the Central Bank rose by a monthly 0.76% from $37.77B by July to $38.05B by end-August. Meanwhile, the dollarization rate of private sector deposits stood at 66.02% in June compared to 66.13% in December 2013.
Due to low inflation, the European Central Bank reduced the refinance rate from 0.15% to 0.05% and the deposit rate to -0.2% in the hope of encouraging businesses and households to increase their spending instead of their savings. Thus, the euro lost 1.80% against the dollar, closing at €/$ 1.2953 on Friday, below the €/$1.3 mark.
The strong dollar lessened demand for its substitute gold, leading to a 2.24% weekly decline in its price from $1,289.74/ounce last week to $1,260.84/ounce on Thursday.
By Friday September the 5th, 2014, 12:30 pm Beirut time, the dollar-pegged LP appreciated against the euro going from €/LP 1,988.54 to €/LP 1,952.66. The Nominal effective exchange Rate (NEER) added 0.70% to 134.97 points, with a 4.58% gain since year-start.