| 13/01/2023 | 05/01/2023 | %Change | YTD | |
| Euro / LP | 1,632.11 | 1,584.00 | 3.04% | 1.67% |
| Euro / Dollar | 1.0827 | 1.0507 | 3.04% | 1.67% |
| NEER Index | 170.62 | 171.61 | -0.58% | 0.05% |
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 January 13, 2023.
Meanwhile on the parallel market, the Lebanese national currency witnessed a sharp fall from 44,400 LBP/USD by the end of week 6 January 2023 to reach all-time high levels of 48,100 LBP/USD during the period between 9 and 13 January 2023 with a minimum of 45,000 LBP/USD and an average of 46,680 LBP/USD by the end of the week January 13, 2023.
As for the Euro/LBP currency pair, the Euro appreciated against the dollar-pegged LBP with the currency pair going from last week €/LBP 1,584.00 by January 05, 2023 to €/LBP 1,632.11 by January 13, 2023. Moreover, the Nominal Effective Exchange Rate (NEER) of the Lebanese pound decreased by 0.58% weekly to stand at 170.62 points on January 13, 2022.
International Forex Market
On Friday, the US dollar falls to nearly 9-month low against major currencies with the dollar index traded 2.83% lower compared to last week at 102.07 driven by cooler inflation data release. Overall, volatility in the currency market could remain unsettled despite the ease in the US inflation which slowed to 6.5% annually but high levels are not yet over. On a different note, jobs openings in the US are coming down, but unemployment rate remains fairly low. As such, mild recession in the US is still very likely; however chances of a soft landing are increasing.
The positive euro-dollar narrative is gaining momentum by the start of 2023 and the market is looking into a stronger euro while recently $1.20 dominated forex debates. The Euro currency has brought a robust appreciation and ended the week higher at $1.0827 which keeps the door open for bears.
Meanwhile, the GBP/USD bounced and back above the $1.2200 level, breaking two consecutive days of losses and traded 2.72% higher at $1.2232 by the end of week January 13, 2023.
Concerning the Japanese currency, the Yen traded at 128.64 this Friday January 13, 3.57% lower from last week previous 133.4. Traders are gearing up for the first policy review of the year for the Bank of Japan after its bond buying operations due to higher benchmark bond yield.
Back to China, the Yuan weakened past a key level and ended the week 2.49% lower at $6.7085 despite 2022 Chinese exports recorded a 10.5% yearly expansion but foreign trade still faces many challenges from the pandemic wave in China.
Commodities
Gold is shining again as investors are betting that cooler US inflation would push the Fed towards slower rate hikes, hence, making investors dropping Government bonds and moving towards other investments, such as yellow metal. In turn, gold prices were on track for a 3.94% weekly gain and reach $1905.39/ounce on Friday January 13, 2023.
Crude oil’ prices recorded a significant jump by the end of the week and traded 6.96% higher to reach $84.17 on January 13, 2023 compared to the previous week of January 5. The increase in oil prices was driven by an optimistic start of the year with cooler inflation and the China reopening faster than expected, adding an extra demand on the oil market.