Responsibility of the Banque du Liban
Banks and the Banque du Liban cannot be exonerated from the process of the skyrocketing exchange rate in the past few days, especially since the decline in the price of the dollar against the pound yesterday afternoon, Friday, by about 8,000 pounds within a few hours is due, according to the information, to the Banque du Liban informing the cashiers and currency dealers with whom it deals. By stopping buying the dollar from the market, which prompted him to retreat.
Whatever the reasons for the recent insane rise of the dollar and its subsequent rapid decline, losses are always inflicted on citizens who are worried about their savings, while currency traders and money changers involved in the currency speculation game achieve financial gains.
And if the dollar has retreated from the level of 63 thousand pounds, but its movement in the vicinity of 55 thousand or 57 thousand means that it has risen from what it was about a week ago, from 5 to 7 thousand pounds. This rise coincides with the approach of February and the start of applying the decision to adopt an exchange rate of 15,000 pounds on bank withdrawals.
high, not low
About a week ago, the exchange rate of the dollar was moving in the vicinity of an average of 50,000 pounds and continued its gradual and accelerating rise until yesterday, Friday, it exceeded the level of 63,000 pounds, that is, an increase of no less than 20 percent, which is a very high rate in relation to the national currency that is fighting for survival.
Then, the exchange rate of the dollar declined within a few hours yesterday afternoon, Friday, and the value of the decrease amounted to about 8,000 pounds, and the wave of decline subsided at 55,000 pounds per dollar. And if the declining path of the lira is due to many factors, all of which revolve around the mismanagement of the financial crisis, then the acceleration in which the dollar soared and was followed by a sudden decline was reinforced by the demand for the dollar by banks and a number of money changers and deliberate speculation operations on the currency.
Currency speculation is not innocent of the political calculations that often exert a direct influence on the currency market.
As for the ability of the Banque du Liban to intervene again in the coming days in the market to control the price of the dollar, it is almost non-existent, and it is not excluded that it will raise the level of its intervention, while emphasizing its inability to pump dollars through an exchange platform at high rates, as was the case previously.
consumption prices
The massive rise in the dollar exchange rate affected all sectors and consumer prices, without its subsequent decline receiving any repercussions in the markets themselves. In the sense that the rise in the exchange rate pulled with it the prices of fuel, medicine, foodstuffs, and so on, while its sudden decline yesterday, Friday, did not affect all of them.
The rise in the exchange rate of the dollar caused the price of gasoline and diesel oil to rise, breaking the ceiling of one million pounds for the first time in the history of Lebanon. As a result, the Ministry of Energy took a decision to issue a fuel pricing schedule twice a day to match the price of the dollar. Meanwhile, the Ministry of Public Health tends to set a daily index for medicine prices, which means that medicines will keep pace with the price of the dollar on the black market.
Between fuel and medicine, there are wholesale increases in food prices that exceeded 30 percent in a few days, affected by the rise in the exchange rate of the dollar. These prices were not affected by the rapid depreciation of the exchange rate as well as the rise. Consumables have always recorded accumulated increases in prices without recording any significant decreases, and always under the pretext of “merchants’ concern for their capital and the level of their profits.”
