Four years of economic collapse and a major currency crisis starting in late 2019 caused the Lebanese pound to lose more than 95% of its value against the US dollar and suffer from significant exchange rate volatility. However, Lebanon has seen a period of relative exchange rate stability since August 2023, hovering around 89,500 LBP/USD.
LIMS attributes this stability to policy changes implemented by the new central bank governor. These changes involve (1) ending government financing in both LBP and USD, (2) halting the printing of LBP not backed by USD reserves, and (3) suspending the acceptance of deposits from banks due to the ongoing financial crisis.
LIMS emphasized the importance of codifying these policy shifts into law to ensure their long-term sustainability and prevent potential policy reversals. Amending the Money and Credit Law would fortify the central bank’s commitment to sound monetary policy and establish a robust framework for continued exchange rate stability. This legal framework would strengthen confidence in Lebanon’s economic stability, potentially attracting capital inflows and ultimately creating a more favorable environment for economic growth.
- Mardini reveals 3 scenarios for the Lebanese economy in 2024! January 3, 2024: Leb Economy, Article AR
- How Can The Current Exchange Rate Stability Be Enhanced? January 15, 2024: Al Jadeed, TV Interview AR
- “Bloomberg” Platform Awaits Security Stability And The Return Of Trainers For Its Use. Mardini To Diyar: It Does Not Affect The Exchange Rate But Transparency And The Central Bank’s Flexibility, January 16, 2024: Addiyar, Article AR
- “Bloomberg” Platform In The Balance Of Economic Experts, January 17, 2024: Al Markazia, Article AR
- “The Central Bank” and Demands for “Stabilizing” the New Monetary Policy within Its Framework, January 12, 2024: Al Safa News, Article AR