|Euro / LP||1,566.47||1,587.39||-1.32%||-8.32%|
|Euro / Dollar||1.0391||1.0530||-1.32%||-8.32%|
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 by Mid-May, 2022.
This week, the Lebanese lira has depreciated against the dollar in the parallel market and recorded approximately 27,000 LBP/USD. With the upcoming parliamentary elections on Sunday 15/05/2022, people are very skeptical that BDL will put an end to circular no. 161 (Sayrafa), in addition to ending subsidies on fuel, medicine and bread, at Sayrafa rate.
In turn, the dollarization ratio for private sector deposits decreased from 79.05% in February 2022 to 78.68% in March 2022.
As for the Euro/LBP currency pair, the Euro depreciated against the dollar-pegged LBP with the currency pair going from last week €/LBP 1,587.39 to €/LBP 1,566.47 by May 13, 2022. Moreover, the Nominal Effective Exchange Rate (NEER) of the Lebanese pound slightly increased weekly by 1.22% to stand at 161.59 points on May 13, 2022.
International Forex Market
The Euro/USD depreciated against the dollar from last week from €/USD 1.0530 to €/USD 1.0391 by May 13, 2022. The Euro-to-Dollar rate has fallen beneath 1.05, reaching its lowest level of 1.039 since the coronavirus crisis in March 2020. The European area is simultaneously facing several exogenous shocks, from the Russia-Ukraine conflict to the climb of Covid-19 cases in China, which will weigh on the EURO outlook.
Gold prices decreased by 3.5% at the end of this week to $1,817.1/ounce; consequently, we are back to the usual negative correlation between the US dollar and the gold price. In fact, gold prices weakened over the past week and remained under the pressure of a stronger US dollar.
Crude oil prices decreased at the end of this week by 1.78% to $107.82/Barrel. Despite this decrease, we note that the volatility in the energy market remains high and unpredictable amid the geopolitical tensions.