Demand for the dollar in the Lebanese Forex market strengthened during the week as the Lebanese pound’s peg against the dollar went from $/LP 1,505-1,509 with a mid-price of $/LP 1,507 to $/LP 1,507–1,511 with a mid-price of $/LP 1,509 affected by the political events of Wednesday and Thursday. Foreign assets (excluding gold) at the Central Bank grew by a monthly 0.7% to reach $38.86B at the end of June. As for the dollarization rate of private sector deposits, it slid from 65.71% in December 2014 to 65.15% by May.
The euro gained a weekly 0.02% against the dollar to reach €/$ 1.1111 as the markets seem to believe in a potential deal after the Greek government submitted a proposal on Thursday taking into account many of its creditors’ demands.
The positive news about Greece gave investor sentiment a boost and pushed safe-haven demand for gold downwards. Accordingly, the price of gold dropped from last week’s $1,168.33/ounce to $1,162.86/ounce at 14:30 pm, Beirut time.
By Friday 10th of July, 2015, 12:30 pm Beirut time, the dollar-pegged LP depreciated against the euro going from €/LP 1,674.68 to €/LP 1,674.98. The Nominal effective exchange Rate (NEER) slid by a weekly 0.11% to 164.55 points, bringing its year-to-date gains to 11.70%.