Banknotes of LL100,000 Lebanese lira. (Credit: Illustrative Photo/ Bigstock)
BEIRUT — The lira market fluctuated on Sunday evening when the Lebanese pound experienced a sudden appreciation against the dollar, moving from around LL40,500 to around LL36,000, after an announcement by the Governor of Banque du Liban Riad Salameh.
Although the lira had stagnated this week at around LL40,500 per dollar, it fell back to LL36,000 as of 7 p.m. on Sunday evening.
In a statement, the Central Bank governor said that, as of Tuesday, the BDL will stop buying dollars at the market rate from money transfer companies, but it will continue to sell at the rate of its Sayrafa exchange platform, which stood at LL30,100 on Friday. The governor said that this will not affect the transactions of depositors (including those made through Circulars No. 151 and 158) or the payment of salaries of civil servants.
However, it is not yet clear whether this decision will have an impact on the terms of the various banking operations or whether it will continue to influence the lira and dollar market rate in the coming hours and days.
Contacted by L'Orient-Le Jour, a trader operating on the parallel market said that this maneuver by Salameh served to bring the Sayrafa rate closer to the market rate, with the gap between these two rates having expanded at the LL40,000 rate and ahead of a potentially politically turbulent week of uncertainty around a government formation and election of a president as President Michel Aoun's mandate deadline looms on Oct. 31.
The trader, however, said he thinks this appreciation of the pound against the dollar "will only be temporary" as he echoed fears of seeing the lira "exceed LL 50,000"' by the end of the year.