
The entrance of the Banque du Liban, Hamra, Beirut. (Credit: P.H.B./L'Orient Today)
BEIRUT — Lebanese eurobonds edged up on Friday, rising to 16 cents on the dollar from 15.6 cents at Thursday’s close.
The slight increase reflects a fairly stable interest among speculators monitoring eurobonds, as the process of forming the Lebanese government by Prime Minister-designate Nawaf Salam seems to be progressing, despite political obstacles.
Lebanon defaulted on its eurobonds in March 2020 after borrowing tens of billions of dollars to fund state expenses, following the financial collapse that began months earlier. Without restructuring or reforms, bond prices plunged, hovering around 7 cents for an extended period. They began recovering last autumn as investors speculated that Hezbollah’s influence would weaken amid Israel’s military offensive. But, it was Joseph Aoun’s election to the presidency that lifted prices above 16 cents.
Optimists predict bond prices could climb to around 25 cents if Lebanon secures a lasting cease-fire with Israel, initiate basic reforms and restructures its $33 billion eurobond debt.