Saudi Press

Saudi Arabia and the world
Sunday, Jun 01, 2025

Currency collapse heaps more misery on Lebanese as prices skyrocket

Currency collapse heaps more misery on Lebanese as prices skyrocket

Lebanese pound loses more ground against the US dollar, adding to the misery of the growing number of people struggling to make ends meet

The Lebanese pound on Monday lost more ground against the US dollar, adding to the misery of the growing number of people struggling to make ends meet in the country.

After meeting President Michel Aoun on Saturday, prime minister designate Mustapha Adib said he was "excusing" himself from the task of forming a government and apologised to the Lebanese people for his "inability to realise its aspirations for a reformist team" to save the country.

Just moments after the Adib announcement, the US dollar surged from LBP7,700 to LBP8,100.

The pound started the week with a further deterioration in the black FX market. Money exchangers were buying the dollar from customers for around LBP8,500 and told potential buyers they don’t have dollars to sell. The dollar traded around LL8,100 on Saturday and LBP7,700 on Friday.


The Lebanese pound's depreciation of more than 80 percent in less than a year has left consumers struggling to buy their basic goods


Licensed exchangers were selling the dollar for LL3,900 and buying it for LL3,850, a rate set by the central bank that has remained unchanged for months, while the official rate stood at LBP1,517 per US dollar.

Despite the country's economic collapse and near bankruptcy, political progress has crawled to a stop.

French President Emmanuel Macron on Sunday attacked the entire Lebanese political class, and warned of a new civil war if they can’t set aside personal and religious interests to unlock international aid and save Lebanon from economic collapse.

Pressures increased on the pound after Lebanon’s Central Bank governor Riad Salameh announced plans to transfer the subsidy from importers to citizens amid dwindling liquid FX reserves, as only $2 billion of the central bank’s liquid FX reserves can be used to finance trade.

The collapse of the currency in the parallel market and the associated skyrocketing inflation to a record 120 percent by the end of August are also fuelling a highly unstable environment.

The resulting erosion of consumers' purchasing power and wealth levels, accompanied by investment contraction, is deepening the expected double-digit economic slump in 2020 and setting the stage for severe social disruptions.

The Lebanese pound's depreciation of more than 80 percent in less than a year has left consumers struggling to buy their basic goods, as prices rose dramatically between Saturday and Monday.

One shopper told Arabian Business: "In the past, I used to buy what I needed in an hour or less. Now I need more than two hours, because of the high prices, so I choose the lowest price, regardless of quality or brand, and prices change from day to day depending on dollar price changes. If I had enough money, I'd have bought more items because I know their prices will rise tomorrow."

Shoppers said they were shocked to find that even the prices of vegetables and fruit grown in Lebanon have increased dramatically, with many basic items disappearing from supermarket shelves altogether.

Eggs are one example: Lebanese farmers explained they are not producing as many as in the past due to the reluctance of the banks to release funds to buy raw materials.

“We need money to buy fertilisers and other materials to use on farms. Many farms have closed down temporarily because farmers can’t get access to fertilisers, so we can’t sell a box of 30 eggs at the official price set at LBP12,500. The minimum price should be LBP15,000 at least,” a farmer told Arabian Business.

Prices of certain products also vary from one supermarket to another, in the absence of effective monitoring by the Ministry of Economy to control prices.

“The continuous rise of the US dollar against the Lebanese Pound is the main reason for the increase in the prices of imported goods. Today we buy the dollar at the rate of LBP8,500, so we updated our prices to match the change in the dollar exchange rate,” said a supermarket owner in Achrafieh, Beirut.

Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
OPEC+ Agrees to Increase Oil Output for Third Consecutive Month
Turkey Detains Istanbul Officials Amid Anti-Corruption Crackdown
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
EU Central Bank Pushes to Replace US Dollar with Euro as World’s Main Currency
European and Arab Ministers Convene in Madrid to Address Gaza Conflict
U.S. Health Secretary Ends Select COVID-19 Vaccine Recommendations
Trump Warns Putin Is 'Playing with Fire' Amid Escalating Ukraine Conflict
India and Pakistan Engage Trump-Linked Lobbyists to Influence U.S. Policy
U.S. Halts New Student Visa Interviews Amid Enhanced Security Measures
Trump Administration Cancels $100 Million in Federal Contracts with Harvard
SpaceX Starship Test Flight Ends in Failure, Mars Mission Timeline Uncertain
King Charles Affirms Canadian Sovereignty Amid U.S. Statehood Pressure
Iranian Revolutionary Guard Founder Warns Against Trusting Regime in Nuclear Talks
UAE Offers Free ChatGPT Plus Subscriptions to Citizens
Lebanon Initiates Plan to Disarm Palestinian Factions
Iran and U.S. Make Limited Progress in Nuclear Talks
The Daily Debate: The Fall of the Dollar — Strategic Reset or Economic Self-Destruction?
Trump Administration's Tariff Policies and Dollar Strategy Spark Global Economic Debate
OpenAI Acquires Jony Ive’s Startup for $6.5 Billion to Build a Revolutionary “Third Core Device”
Turkey Weighs Citizens in Public as Erdoğan Launches National Slimming Campaign
Saudi-Spanish Business Forum Commences in Riyadh
Saudi Arabia and Spain Sign MoU to Boost SME Sectors
UK Suspends Trade Talks with Israel Amid Gaza Offensive
Iran and U.S. Set for Fifth Round of Nuclear Talks Amid Rising Tensions
Russia Expands Military Presence Near Finland Amid Rising Tensions
Indian Scholar Arrested in Crackdown Over Pakistan Conflict Commentary
Israel Eases Gaza Blockade Amid Internal Dispute Over Military Strategy
President Biden’s announcement of advanced prostate cancer sparked public sympathy—but behind closed doors, Democrats are in panic
A Chinese company made solar tiles that look way nicer than regular panels!
Indian jet shootdown: the all-robot legion behind China’s PL-15E missiles
The Chinese Dragon: The True Winner in the India-Pakistan Clash
Australia's Venomous Creatures Contribute to Life-Saving Antivenom Programme
The Spanish Were Right: Long Working Hours Harm Brain Function
Did Former FBI Director Call for Violence Against Trump? Instagram Post Sparks Uproar
US and UAE Partner to Develop Massive AI Data Center Complex
Apple's $95 Million Siri Settlement: Eligible Users Have Until July 2 to File Claims
US and UAE Reach Preliminary Agreement on Nvidia AI Chip Imports
President Trump and Elon Musk Welcomed by Emir of Qatar Sheikh Tamim with Cybertruck Convoy
Strong Warning Issued: Do Not Use General Chatbots for Medical, Legal, or Educational Guidance
Saudi Arabia Emerges as Global Tech Magnet with U.S. Backing and Trump’s Visit
This was President's departure from Saudi Arabia. The Crown Prince personally escorted him back to the airport.
NVIDIA and Saudi Arabia Launch Strategic Partnership to Establish AI Centers
Trump Meets Syrian President Ahmad al-Shara in Historic Encounter
Trump takes a blow torch to the neocons and interventionists while speaking to the Saudis
US and Saudi Arabia Sign Landmark Agreements Across Multiple Sectors
Why Saudi Arabia Rolled Out a Purple Carpet for Donald Trump Instead of Red
Elon Musk Joins Trump Meeting in Saudi Arabia
Trump says it would be 'stupid' not to accept gift of Qatari plane
Quantum Computing Threatens Bitcoin Security
Michael Jordan to Serve as Analyst for NBA Games
×