Lebanese Pound Holds Steady Against the Dollar,but Uncertainty Remains
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The Lebanese pound showed relative stability against the US dollar on Sunday,January 5,2025,in official banks. However, the situation in the parallel market remains a source of ongoing concern.
Official Exchange Rate: A Glimpse of Stability
At the Central Bank of Lebanon, the official exchange rate held steady at approximately 15,000 Lebanese pounds (LBP) to 1 US dollar. This represents a small fraction of the black market rate, highlighting the deep economic challenges facing the nation.
Black Market Fluctuations: A Persistent Challenge
The parallel market, however, tells a different story. The unofficial exchange rate remained relatively stable on Sunday, but the figures are substantially higher than the official rate.The dollar traded at around 89,600 LBP for purchase and 89,700 LBP for sale. This vast discrepancy underscores the ongoing economic crisis and the lack of confidence in the official banking system.
Money Changers Reflect Market Trends
Exchange rates at money changers mirrored the trends observed in the parallel market, further solidifying the prevailing exchange rates.
Dollarization: A Symptom of Deeper Issues
The Lebanese economy has become increasingly reliant on the US dollar, a phenomenon known as “dollarization.” This trend emerged after the 2019 economic crisis and subsequent protests, leading to a importent devaluation of the Lebanese pound against the dollar, both in the parallel market and eventually within the formal banking system. The reliance on the dollar reflects a deep lack of confidence in the Lebanese pound and the country’s economic stability.
The situation in Lebanon serves as a stark reminder of the fragility of economies facing political instability and economic crises.The ongoing volatility of the Lebanese pound highlights the need for comprehensive economic reforms and a restoration of confidence in the Lebanese financial system.
The article states that:
The official exchange rate of the Lebanese Pound to the US dollar is around 15,000 LBP.[Article]
The parallel market exchange rate is significantly higher, with the dollar trading around 89,600 to 89,700 LBP [Article]
