Lebanon Announces Measures to Stabilize Currency, Food Prices

Lebanese officials announced more measures to stabilize the nation’s plunging local currency and rein in soaring food prices that have triggered nationwide protests.

The government will expand the list of subsidized goods, such as wheat, fuel and medicine, to include more than 200 food items, Economy Minister Raoul Nehme said at a joint briefing with central bank Governor Riad Salameh and Head of General Security Abbas Ibrahim.

Nehme and the security chief also said they would crack down on traders and suppliers who increase prices to boost profit margins. Annual inflation in the country is currently 57%, the highest since the country emerged from a civil war three decades ago. Food costs three times the amount it did a year ago.

Earlier on Friday, the central bank introduced an electronic foreign-exchange platform to centralize the black market, allowing licensed money changers and banks to participate. Salameh said almost $8 million traded on the first day and the pound rate was between 3,850 and 3,900 to the U.S. dollar.

The government has blamed the central bank for the collapse of the currency that’s trading at about 7,000 pound per U.S. dollar on the black market. The rate at commercial banks will remain at the official peg of 1,507.5 to the dollar, Salameh said.

The use of the platform will be increased so it become the "the primary reference” to trade banknotes in foreign currency, particularly the U.S. dollar against the pound, Salameh said.

©2020 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.