The fall of the Lebanese pound to a record low of 80,000 to 1 against the US dollar has compounded the disaster for residents whose savings in the local currency have been eroded by inflation. The ongoing bank strike demanding the passage of capital control legislation has made matters even worse for residents.
Lebanese Pound Devaluation
The Lebanese currency recently plunged to an all-time low of 80,000 per US dollar on the unofficial foreign exchange market, according to several local media reports. The Lebanese pound’s parallel market decline occurred less than a month after it was devaluedby more than 90% on the official market
The devaluation of the currency from 1507 to 15,000 to the dollar is seen as an attempt by the monetary authorities to unify the multiple exchange rates for the pound, but some experts argue that the new official exchange rate is fixed much lower than the rate at which most transactions are
Meanwhile, the currency’s plunge has piled more miseryon Lebanese residents, whose pound-denominated savings have already been depleted by the country’s high inflation rate. As Bitcoin.com News previously reported, the country’s residents have been unable to withdraw their savings after their banks froze their accounts and have been unable to withdraw their savings after banks froze their accounts.
Capital Control Reforms
To compound the problems of residents, the country’s banks have recentlygone on strikedemanding the passage of a capital control law that would restrict withdrawals of foreign and local currencies. (IMF) reportedly called for capital control reforms to be implemented before funds could be released.
However, in response to the banks’ actions and the pound’s recent plunge, Lebanese residents reportedly attacked closed bank branches.34} One video shared on social mediashows angry Lebanese demonstrators attempting to set fire to the home of the president of the Lebanese Bankers Association Lebanese protesters attempt to set fire to the house of the president of the Lebanese Bankers Association.
Nigerian banks 🔥 and now in Lebanon. Economic apartheid oppresses an entire civilization, and if that is not enough, currency wars tighten the noose. Humanity is rising up. The revolution has begun. ✊🏽 https://t.co/D9PlFAOArK
– Ray Youssef (@raypaxful) February 17, 2023
On Twitter, some users shared photos and videos of bank buildings burning, and crypto enthusiasts reported that Lebanese banks were blocking customers’ access to their funds blocked access to their customers’ funds, highlighting the risks of using digital currencies issued by central banks.
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