Lebanese Forex Market
The Lebanese Pound traded within the range of $/LP 1,514-1,514.5 against the dollar with a mid-price of $/LP 1,514.25 by the week ending May 11th, at the same range as last week.
The peg continues to be supported by the Central Bank’s solid foreign assets, which reached $43.4 billion in March 2018.
The dollarization ratio of private sector deposits grew from 65.84% in December 2017 to 68.44% in January 2018.
Over the past week, the Euro continued to depreciate against the dollar-pegged LP going from €/LBP 1,819.70 to €/LBP 1,798.90 this week.
As for the Nominal Effective Exchange Rate (NEER) of the LBP, it marginally slid by 0.07% to end the week at 112.00 points.
International Forex Market
The dollar rallied throughout the week, mainly supported by the rising crude oil prices that followed the US decision to leave the Iranian nuclear agreement. Moreover, the euro also weakened against the dollar as reflected in the 1.14% downtick in the euro-dollar rate which slipped from €/$ 1.21 last week to €/$ 1.19 this week. This was mainly linked to the heightened political bickering among Italy’s major political parties that weighed down on the Eurozone’s unified currency.
Commodities
With the dollar rally undergoing corrective action on the back of lower than expected US inflation data released late Thursday of this week, Gold prices picked up from $1,313.53/ounce to $1,324.45/ounce by the week ending May 11th.