The factors behind Lebanese exchange rate stability

The Lebanese exchange rate has been relatively stable in the past few weeks, hovering below the LBP 100,000 mark. According to experts, two main reasons have contributed to this current stability.

The first reason is the intervention of the Banque du Liban (BDL), which has injected dollars into the market. This can be seen through the increase in trading volumes on the Sayrafa platform, which have reached between 70 and 90 million dollars daily, compared to around 30 million dollars during the same period in March.

Moreover, the influx of Lebanese expatriates and tourists during the Easter and Eid al-Fitr holidays has brought an estimated $400 million to the country in addition to the dollars accumulated by the BDL in previous months, which helped stabilize the exchange rate that reached a high of LBP 140,000 in late March.

The second reason for the stability in the exchange rate is the intention of the governor of the BDL to end his term on July 31st in a relatively calm environment, both in terms of the exchange rate and in terms of preserving what remains of the BDL's foreign currency reserves. This relies on the influx of dollars from expatriates during the summer season.

However, it is essential to remember that the exchange rate was at LBP 40,000 at the beginning of the year and was around LBP 25,000 at this time last year, while it was LBP 12,000 two years ago and LBP 3,000 before that.