| 28/07/2023 | 21/07/2023 | %Change | YTD | |
| Euro / LP | 16,465.50 | 16,681.50 | -1.29% | 925.74% |
| Euro / Dollar | 1.0977 | 1.1121 | -1.29% | 3.09% |
| NEER Index | 132.16 | 131.78 | 0.29% | -22.50% |
Lebanese Forex Market
The Lebanese Pound (LBP) remained steady within the new official rate of USD/LBP 15,000 by July 28, 2023.
On the parallel market, the Lebanese national currency remained steady this week with an average of 92,265 LBP/USD compared to an average of 92,521 LBP/USD previous week. The pair LBP/USD recorded a minimum of 89,500 LBP/USD and a maximum of 93,500 LBP/USD during the course of this week. Despite latest stability in the local forex market, uncertainty is looming especially with the country’s political landscape and Central Bank’s Governance vacancy in the spotlight.
As for the Euro/LBP currency pair, the Euro appreciated against the dollar-pegged LBP with the currency pair going up from last week €/LBP 16,681.50 to €/LBP 16,465.50 by July 28, 2023. But the Nominal Effective Exchange Rate (NEER) of the Lebanese pound went up by 0.29% weekly to stand at 132.16 points on July 28, 2023.
International Forex Market
This week, the US dollar rallies after strong GDP data showing a better than expected growth in the US economy by 2.4% Q2 exceeding the 1.8% expected and 2% registered last quarter. As such, the dollar index slightly increased by 0.62% to stand at 101.702 at July 28, 2023.
In turn, the Euro and British pound depreciated respectively against the dollar by 1.26% and 0.49% to stand at EUR/USD 1.0983 and GBP/USD 1.2792 by the week ending July 28, 2023. The euro currency pulled back below the 1.1000 level after ECB followed the Fed decision and raised the rate from 4% to 4.25% while GBP currency dropped as the British market are betting on two further Bank of England interest rate hikes.
As for the Japanese currency, the yen depreciated slightly by 1.72% to stand at USD/ JPY 139.35 by July 28, 2023. Despite the weekly drop, the USD/JPY pair revealed wild spikes by Friday after the BoJ policy announcement regarding more flexibility in Japanese Government Bonds yields while keeping interest rate unchanged. Central Bank’s action would result in gradual tightening monetary policy that would make the Japanese yen safeguarded against other currencies.
Back to the west, Swiss currency rose to the highest level in two weeks as it stretches the previous day’s rebound from the lowest levels since 2015. The USD/CHF pair appreciated by 0.39% on a weekly basis to stand at 0.8691 on Friday July 28, 2023.
Elsewhere, the Australian dollar depreciated by 1% from the previous week to stand at 0.666 AUD/USD by June 28, 2023 while the Canadian dollar slightly changed positively against the US dollar to reach 1.3229 on July 28, 2023.
Commodities
Gold recorded first weekly loss in four weeks and retreated by 0.58% to 1,948.85/ounce by Friday July 28, 2023. The precious metal faces the burden of a stellar performance by the US economy in the second quarter, a strong demand, and already tight labor market conditions. However, the hitch in the Gold price cannot be ruled out as concerns of further policy tightening by the Fed are renewed.
This week, crude oil prices rose by 3.36% reaching $83.79 per barrel. Oil prices have mounted a remarkable rally as fundamentals have tightened significantly. In fact, analysts have expected that a seasonal increase in demand coupled with production cuts will lead to large supply deficits over the coming months such as China that has gorged up a record amount of Russian crude, adding some 2 million bpd to its strategic and commercial inventories last month. This is happening while market watchers expect Saudi Arabia to outspread its 1 million bpd voluntary production cut and Russia to top the Western price cap of $60 per barrel.