Lebanese pound loses 13% of its value in less than a week

The sharp drop of Lebanon's national currency against the dollar sparked anger across the country

Lebanon currency has lost 11 per cent against the dollar in less than a week. Photo AFP

The Lebanese pound experienced a sudden decline on the parallel market, reaching 57,000 against the dollar on Wednesday morning, marking a loss in value of 13 per cent in a week.

Once pegged at around 1,507 to the US currency, the Lebanese pound has now lost 97 per cent of its value since the start of an unprecedented financial crisis caused by a drastic shortage of dollars, which plunged 80 per cent of the population into poverty.

The sudden drop in the exchange rate caused sporadic protests throughout the country.

In Beirut, the Depositors' Outcry Association, an advocacy group for depositors, called for a sit-in outside the Central Bank headquarters in Beirut, which was joined by a small group of protesters on Wednesday.

Lebanon's National News Agency reported that demonstrators blocked several roads across the country on Tuesday and Wednesday to protest the worsening living conditions and soaring inflation. The inflation surged to 171 per cent in 2022, one of the highest levels in nearly four decades, according to Central Administration of Statistics inflation figures released in January.

Gas stations closed

Fuel tariffs sharply increased on Wednesday, as the Ministry of Energy released new prices. The move came to respond to the sharp drop of the Lebanese pound against the dollar by hiking the prices of 20 litres of 95-octane gasoline, 98-octane gasoline and diesel by almost LL50,000.

The Energy Ministry publishes daily tariffs in Lebanese pounds, but fuel imports are dollar-dependent and need adjustment when the local currency depreciates.

The ministry had already increased fuel prices on Tuesday to fall in line with the current exchange rate, but prices were already out-of-date at the end of the day.

On Wednesday morning, most gas stations were closed across Lebanon to contest the high instability of the currency as gas distributors were waiting for the publication of an updated list of prices, causing long queues in front of the ones that were still operating.