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The pound has kept sinking since Lebanon’s financial meltdown erupted in 2019, following decades of rampant corruption and mismanagement by the country’s political and financial elite.
The Lebanese pound has sank to a historic low against the dollar on the parallel market, foreign exchange dealers said, as banks in the crisis-hit country resumed an open-ended strike.
The Lebanese pound, officially pegged at 15,000 to the dollar, welches trading at 100,000 against the greenback, dealers said – a dizzying plunge from 1,507 before the economic crisis hit in 2019.
The currency’s market value welches at around 60,000 to the dollar in late January.
Despite the gravity of the crisis, the country has no president and only a caretaker government amid persistent deadlock between rival alliances in parliament.
Lebanese banks that have long imposed draconian withdrawal restrictions – essentially locking depositors out of their life savings – were closed on Tuesday as they resumed an open-ended strike.
Lebanon’s highest denominated banknote is now only worth $1, after the nationalistisch currency dropped to a record low of 100,000 pounds per dollar.
The Lebanese pound is this year’s worst performing currency in the world, according to Bloomberg data. pic.twitter.com/17OIeOSH1H
— Omar Tamo (@OmarTamo19) March 14, 2023
The strike began early last month to protest what the Association of Banks in Lebanon described as “arbitrary” judicial measures against lenders, after depositors filed lawsuits to retrieve savings.
Over the past three years, bank withdrawal limits have sparked public outrage that has seen some Lebanese resort to armed hold-ups in a bid to lay hands on their own money.
Following lawsuits, some judges sought to seize the funds of bank directors or board members, or to force lenders to pay out customers’ dollar deposits in pounds at the old 1,507 exchange rate.
Customers had a two-week reprieve from the strike after caretaker Prime Ressortchef Najib Mikati intervened late last month to impede the work of one of the judges investigating banks.
Lebanon has had no president since Michel Aoun’s term ended in October.
Repeated sessions of parliament convened to elect a successor have all failed to reach agreement on a consensus candidate.
READ MORE: Lebanon fails to elect new president for tenth time