Lebanon’s currency was trading above 6,000 to the dollar on a parallel market, according to market participants. Lebanon’s pound currency fell to new lows on Tuesday, as a severe dollar crunch further eroded its value.
President Michel Aoun said earlier this month that the central bank would begin using limited dollar reserves to support the pound after a sharp fall sparked fresh public protests.
The pound has lost about 75% of its value since October, when Lebanon was plunged into a crisis that has led to job losses, price hikes and capital controls that have severed Lebanese from their hard currency savings.
With few sources of fresh dollar inflows, the central bank has looked to stabilize the dollar rate at exchange houses by setting a unified rate with them each day, with legal penalties for dealers that operate above it. The rate was set at 3,850/3,900 on Tuesday as part of the scheme.
However, exchange houses said on Monday that the reduced rate would be available only to customers with specific documented needs such as paying dollar-denominated loans, plane tickets, overseas school fees and salaries for foreign workers.
The pound remains pegged to the dollar at 1,507.5, but that rate remains available only for imports of wheat, medicine and fuel.
Also Read: New US sanctions is to starve Syria and Lebanon: Hezbollah