Lebanon to sell unlimited US dollars to save crashing pound

Joy Onuorah
Joy Onuorah
Lebanon to sell unlimited US dollars to save crashing pound

Lebanon’s central bank governor, Riad Salameh has announced that the bank will sell unlimited amounts of U.S. dollars to counter the escalating devaluation of the Lebanese pound.

Salameh fixed a new rate of 90,000 Lebanese pounds per dollar on the central bank’s exchange platform, Sayrafa, up from 70,000 on March 1.

However, the pound’s parallel market rate plummeted from around 121,000 to the dollar in the morning to 140,000 in the afternoon, triggering residents’ protests against their declining purchasing power.

The Lebanese pound has been losing value since 2019 and has depreciated by more than 98%.

Although the central bank revalued it officially to 15,000 per U.S. dollar in February, its rate on Sayrafa has been significantly lower and variable.

Salameh approved the move with the consent of the caretaker premier and finance minister to limit the pound’s devaluation on the parallel market.

Salameh also urged those interested in trading to use Grade A exchange houses or banks that have lifted their strike.

Last week, Lebanese banks went on strike to demonstrate legal actions taken against them. Following the announcement, the parallel market’s exchange rate for the pound started rising.

The International Monetary Fund has suggested several measures for Lebanon to secure a $3 billion aid package to help it recover from the economic crisis.

One of these measures includes unifying the multiple exchange rates.

However, Lebanon is still struggling with multiple exchange rates as it approaches the one-year mark since signing a preliminary agreement with the IMF.

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