| 12/05/2023 | 05/05/2023 | %Change | YTD | |
| Euro / LP | 16,395.00 | 16,534.50 | -0.84% | 921.35% |
| Euro / Dollar | 1.0930 | 1.1023 | -0.84% | 2.65% |
| NEER Index | 118.17 | 117.61 | 0.48% | -30.70% |
Lebanese Forex Market
The Lebanese Pound (LBP) remained steady within the new official rate of USD/LBP 15,000 by May 12, 2023.
On the parallel market, the Lebanese national currency surprisingly remained steady this week with an average of 94,000 LBP/USD. The pair LBP/USD recorded a minimum of 94,200 LBP/USD and a maximum of 94,600 LBP/USD during the course of this week.
As for the Euro/LBP currency pair, the Euro depreciated against the dollar-pegged LBP with the currency pair going from last week €/LBP 16,534.50 by May 05, 2023 to 16,395 by May 12, 2023. The Nominal Effective Exchange Rate (NEER) of the Lebanese pound went up by 0.48% weekly to stand at 118.17 points on May 12, 2023.
International Forex Market
This week, the US dollar rebounded against major currencies as the dollar index increased by 0.48% on a weekly basis to 102.069 on May 12, 2023. During the week, the market received several disappointing data that supported the narrative that the Federal Reserve could cut interest later this year. In details, the US CPI for the month of April came in below expectation YoY at 4.9% (vs. 5% expected), which indicate that inflation is easing. On the other hand, the weekly jobless claims came in above expectations at 264k (vs. 245k expected), in the week ending May 6, marking its highest level since October. Meanwhile the US PPI for April increased by only 2.3% (vs. 2.5% expected) on a monthly basis.
The Euro depreciated against the dollar by -0.84% to $1.0930 amid a strong dollar. Bloomberg released a report during the week, indicating that officials were considering the possibility of further rate hikes in September as the two planned for June and July may not be sufficient in lowering inflation. If the ECB decides to continue raising rates by 25 basis points, a third hike in September could result in the deposit rate reaching 4%. To complement this hawkish outlook, ECB President Lagarde commented in an interview with Japan’s Nikkei newspaper that more efforts are necessary to manage inflation.
The British pound also increased against the US dollar by 0.78 % to stand at $1.2527 by the week ending May 12, 2023. This week, the BoE announced another 25bps hike that pushed the rate to its highest level since 2008 at 4.5%. Furthermore, the BoE growth’s projections received remarkable upward revisions, while the central bank is not predicting anymore a possible recession. However, growth was still expected to be low compared to historical standards, with just +0.25% growth projected for 2023, followed by +0.75% growth in 2024 and 2025.
This week, the USD/JPY decreased by 0.08 % to reach 134.75 by May 12, 2023. Meanwhile, the Australian dollar appreciated by 0.56% on a weekly basis to stand at 0.669 AUD/USD by May 12, 2023. Elsewhere, the Canadian dollar appreciated by 0.54% on a weekly basis to reach CAD 1.3493 for a US dollar.
Commodities
Gold markets oscillated between gains and losses this week before retreating by 0.10% to $2,007.28/ounce amid a stronger dollar.
Crude oil prices rebounded this week on the back of stronger fuel demand from the US. Accordingly, oils prices increased this week by 7.82% to $74.76/barrel.