Arab Press

بالشعب و للشعب
Tuesday, May 13, 2025

Lebanon devalues official exchange rate by 90 percent

Lebanon devalues official exchange rate by 90 percent

The central bank has confirmed the new official rate of 15,000 pounds per dollar, up from little more than 1,500.

Lebanon has devalued its official exchange rate for the first time in 25 years, weakening it by 90 percent but still leaving the local currency well below its market value.

The central bank confirmed the new official rate of 15,000 pounds per United States dollar on Wednesday, scrapping the rate of just more than 1,500 pounds at which the currency was pegged for decades before the currency collapsed.

The pound has crashed in the past few years, with many Lebanese pointing to mismanagement by the country’s ruling elite and decades of corruption that led to a financial meltdown in 2019.

Lebanese officials have described the adoption of the new official exchange rate as a step towards unifying an array of rates that have emerged during the crisis.

But market participants said the pound was changing hands at about 60,000 per dollar on Wednesday on the parallel market, where most trades take place.

Since the economic downturn, Lebanon’s cash-strapped banks imposed informal limits on cash withdrawals in dollars, with most depositors losing access to their savings.

The new rate will be applied to limited withdrawals in local currency from US dollar accounts. It is also due to be applied to customs duties in a country that depends heavily on imports.

Withdrawals in Lebanese pounds from hard currency accounts at the new official rate will still suffer a de facto haircut of 75 percent based on Wednesday’s market rate.

Unifying multiple exchange rates is one of several steps sought by the International Monetary Fund for Lebanon to clinch a $3bn aid package that would help it to emerge from the meltdown.

But the IMF said last year that progress in implementing reforms remained “very slow”, with the bulk yet to be carried out despite the gravity of a crisis marking Lebanon’s most destabilising phase since the 1975-90 civil war.

That peg to the dollar was implemented in 1997 to encourage investor confidence and to stall hyperinflation after its 15-year conflict.

Lebanon’s Central Bank and Finance Ministry first announced the decision to officially devalue the pound last September.


Newsletter

Related Articles

Arab Press
0:00
0:00
Close
Senate Democrats Move to Censure Trump Over Qatar Jet Gift
Hamas Releases Last Living US Hostage from Gaza Amid Ongoing Conflict
India and Pakistan Agreement on Ceasefire Amid Ongoing Tensions
Trump's Upcoming Middle East Trip Excludes Israel, Raising Concerns Among Israeli Officials
Trump's Upcoming Visit to Gulf Nations: Investment and Security at the Forefront
Cardinal Robert Prevost Elected as Pope Leo XIV, Marking a Historic Papacy
India-Pakistan conflict may be first test for Chinese military tech
Common Sense Returns to Britain's Legal System: UK Supreme Court Declares a Woman Is… a Woman
Warren Buffett to Step Down as Berkshire CEO After Nearly 60 Years
Trump Shares AI-Generated Image of Himself as… Pope, Prompting Outrage Reaction
Amazon Launches Satellite Internet Service Amidst Competition with SpaceX
Trump Administration Removes National Security Adviser Mike Waltz Amid Signal Chat Controversy
Massive Explosion at Iran's Bandar Abbas Port Linked to Suspicious Chemical Shipments
Pope Francis Laid to Rest in Rome as World Leaders Attend Funeral
Not Child’s Play: How Competitive Gaming Became a Global Economic Empire
California Surpasses Japan to Become the World’s Fourth-Largest Economy
Former U.S. Congressman George Santos sentenced to eighty-seven months for wide-ranging fraud
Israel Considers Limited Strikes on Iran's Nuclear Facilities Amid Diplomatic Efforts
Saudi Arabia Offers Max Verstappen Unprecedented Deal to Join Aston Martin
Global Pistachio Shortage Amid Rising Demand for 'Dubai Chocolate'
IMF Predicts No Global Recession Amid Trade Tensions
Removing the Political Rival Means Diminishing What's Remaining of Turkey's Economy
White House Investigates Security Breach After Journalist Accidentally Added to Secret Yemen Strike Chat
UAE Pledges $1.4 Trillion Investment Strategy in the United States
Revealing the Electromagnetic Characteristics of the Great Pyramid of Giza
Netanyahu Dismisses Shin Bet Chief Amid 'Loss of Trust' and 'Qatargate' Corruption Investigations Involving Netanyahu's Advisors
U.S. Approves $100 Million Precision Rocket Sale to Saudi Arabia Amid Ongoing Yemen Conflict
High-ranking ISIS Official Neutralized in Collaborative Operation in Iraq
Netanyahu Rejects UN Reports on Gaza as 'Untrue'
Six Americans Freed from Detention in Kuwait
Syria Wraps Up Military Campaign Amid Extensive Violence and Large-Scale Killings.
Trump Speaks Out on the Arrest of Pro-Palestinian Student at Columbia University
Demonstrations Break Out as Individual Ascends Big Ben with Palestinian Flag
Over 300,000 Refugees Expected to Return to Syria Amid Ongoing Crisis
Trump Urges Nuclear Talks with Iran as Tensions Escalate
US Launches AI Initiative to Track Foreign Nationals' Social Media for Terrorist Support.
US Initiates Direct Discussions with Hamas During Hostage Situation
US Government Dismisses Arab Leaders' Plan for Gaza Reconstruction
US Engages in Unprecedented Covert Talks with Hamas Regarding Hostages
Arab Leaders Approve $53 Billion Initiative for Gaza Reconstruction
Iran's Enriched Uranium Stockpile Reaches Levels for Six Nuclear Devices
Israel Indicates Willingness to Resume Military Operations in Gaza
Hamas Lets Go of Last Israeli Hostage as Part of Ceasefire Deal
Trump Adjusts Gaza Resettlement Plan Following Rejections from Regional Leaders
The negotiation teams of Trump and Putin meet directly, establishing the groundwork for a significant advance.
Israeli Minister Urges Hamas to Surrender and Depart from Gaza.
Iran Considers Moving Its Capital Due to Urban Difficulties
Israel and Hamas Finalize Sixth Exchange of Hostages and Prisoners During Continuing Gaza Ceasefire
Leaders of BRICS to Gather in Rio de Janeiro for July Summit
Muhsin Hendricks, a trailblazing openly gay imam, was killed in South Africa.
×