The EURO Appreciated this Week Amid ECB Decision on Cuts Rate
Lebanese Forex Market
The Lebanese Pound (LP) steadied during the past week within the range of $/LP 1,514 – 1,514.5 against the dollar, with a mid-price of $/LP 1,514.25.
The peg continues to be supported by the Central Bank’s solid foreign assets, which were further replenished to reach $38.70B by August 2019, largely thanks to BDL’s launched initiative by end-July which aimed to boost investors’ confidence mainly by re-incentivizing commercial banks to attract fresh dollars as deposits.
The dollarization ratio of private sector deposits increased slightly from 70.62% in Dec. 2018 to 71.73% in July 2019. It’s worthy to note that the average interbank rate stood at 5% in the week ending Sept.06th.
The Euro appreciated against the dollar-pegged LP to end the week at €/LBP 1,671.71 compared to last week’s €/LBP 1,663.13. As for the Nominal Effective Exchange Rate (NEER) of the LBP, it slipped by a weekly 0.60% to stand at 119.26 points.
International Forex Market
The Euro/USD currency pair stood at €/USD 1.1089 in the week ending Sept. 13, up from last week’s €/USD 1.1032 . In fact, the Euro appreciated this week following the European Central Bank decision on Thursday to start a fresh stimulus package: cutting its deposit rate to a record low -0.5% from -0.4% and approving bond purchasing of 20B euros a month from November in order to support the euro zone growth.
Commodities
Accordingly, gold prices fell from last week’s $1506.70/ounce to $1502.80 this week.
