Lebanon devalued the official exchange rate by 900%

The Lebanese pound is dying against the dollar. The Central Bank established the exchange rate at 15,000 pounds per dollar, but on the black market it is exchanged on average at 60,000 (WAEL HAMZEH/)

The Central Bank of Lebanon applied this Wednesday a strong rise to the official exchange rate of the Lebanese pound, which goes from 1,507.5 units per dollar to 15,000 per US bill, in the first increase announced by the issuing entity in more than three decades.

Last week, the Central Bank issued a series of circulars announcing that from February 1 the country’s banks would begin to use the exchange rate of 15,000 pounds for one dollar for their transactions, a value still well below of the handled in the black market.

A source from the Central Bank who requested anonymity explained to EFE that from this Wednesday the entities operate exclusively based on the change of 15,000 units for one dollar and added that a series of intermediate values ​​announced for different uses in the sector have disappeared since the start of the economic crisis in 2019.

“This confirms that there is no longer such a thing as 1,500, 8,000 or 12,000, they have all become 15,000,” he said.

A man counts US dollar bills at a change shop in Beirut, Lebanon
A man counts US dollar bills at an exchange store in Beirut, Lebanon (MOHAMED AZAKIR/)

Although due to the luck of “playpen” that has been experienced in the country since the outbreak of the crisis, some values ​​had been established a little higher than the official one for certain bank transactions, the official exchange rate had remained unchanged for more than three decades.

However, the source specified that, for the rest of the sectors, it is the State that must clarify when it will be in a position to adopt the new value and which institutions will be governed by it.

Currently, the exchange rate on the black market is what determines the prices of almost everything in the nation of cedars and the official one has very few uses, due to the enormous gap created between the two since the crisis began in 2019, when both were even.

This morning, the lebanese pound it is exchanged at 60,000 units for a dollar on the black market, after last week exceeding the barrier of 63,000, the last record low amid the constant losses in value that it has suffered for three years.

The Governor of the Central Bank, Riad Salamehhad anticipated at the end of last year that a new exchange rate would enter into force on February 1, 2023, but the Lebanese authorities limited themselves to saying that it would apply first to customs taxes and, later, to other areas, without offering details.

The sharp rise that began to be applied this Wednesday supposes a devaluation of the Lebanese pound of almost 90%, in official terms.

(With information from EFE)

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