BEIRUT, Sept 29 (Businesshala) – Lebanon’s central bank has rejected any change in the exchange rate used to withdraw cash from U.S. dollar accounts to the Lebanese pound in the absence of a comprehensive plan for the economy. is in deep financial trouble, the bank said on Wednesday.
The hard currency has dried up in Lebanon since a major financial downturn in 2019, and savers with US dollar accounts have only been able to make withdrawals in Lebanese pounds at an exchange rate of 3,900 pounds for dollars.
That means an actual haircut – or reduction – of about 80% on the value of their savings, turning the dollar into about £17,000 in the parallel market on Wednesday.
The MPs are demanding an increase in the rate applicable on cash withdrawals. But in a statement on Wednesday, the central bank said any rate change in the absence of a comprehensive financial plan would have “major consequences” on the money supply “and the dollar exchange rate”.
The central bank said it is extending existing rules that set the exchange rate to be used for cash withdrawals from hard currency accounts by January 31, 2022, “to give the government time to present its reform plan”. for”, the bank said.
Prime Minister Najib Mikati, who took office this month, has vowed to resume talks with the International Monetary Fund and implement reforms to address the crisis. (Reporting by Layla Bassam; Writing by Tom Perry, Editing by William McLean)