|Euro / LP||1,610.58||1,591.46||1.20%||-5.74%|
|Euro / Dollar||1.0684||1.0557||1.20%||-5.74%|
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 27 May, 2022.
On the parallel market this week, the Lebanese currency plunged to a new low record of 37,600 against the dollar as concerns of further economic meltdown could took place due to deep divisions and future political standoffs within the new elected parliament. Furthermore, Lebanon Government approved and submitted a recovery plan during its latest Cabinet meeting to pull out the nation from its economic crisis. However, the Association of banks in Lebanon rejected the plan as it places the full losses on depositors and shareholders.
As for the Euro/LBP currency pair, the Euro appreciated against the dollar-pegged LBP with the currency pair going from last week €/LBP 1,591.46 to €/LBP 1,610.58 by May 27, 2022. Moreover, the Nominal Effective Exchange Rate (NEER) of the Lebanese pound slightly increased weekly by 0.49% to stand at 161.43 points on May 27, 2022.
International Forex Market
The Euro/USD appreciated against the dollar from last week from €/USD 1.0557 to €/USD 1.0684 by May 27, 2022. European Central Banks are concerned about the weakening euro and the ultimate way to combat the rising inflation in the Eurozone is by strengthening the currency. As such, the ECB might support a 50 basis points hike in July and more rate hikes are to come.
Gold prices slightly increased by 0.85% at the end of this week to $1,857.5/ounce; amid spiking inflation and global uncertainty, downside risk remains for commodities such as Gold. Consequently, the gold market could sense the tightening policy of Central Banks and once again performs as a smart hedge during the year. And in our humble opinion, Gold would be setting up for new record highs
Crude oil prices also recorded a slight increase at the end of this week by 0.81% to $113.7/Barrel. Volatility is high amid global geopolitical tensions. However, impact of higher food and energy costs, and the consequences of a slowing global and especially Chinese economy due to a new wave of COVID have led to a lower demand for oil.