The most talked-about topic in Lebanon these days is the exchange rate of 1 USD to Lebanese Lira. No wonder the LBP’s devaluation started nearly a year ago upon the start of the October 17, 2019, revolution.
The Lira rate debate is the town’s talk; wherever you go, the topic is always discussed with loads of conspiracy theories and predictions of the currency’s fate.
We at LiraExchange.com will provide daily USD to Lebanese Lira rates from the black market applications and websites. The purpose is to help you find and know the daily rates of different sources all in one place.
Lebanese Lira Devaluation Effects:
The harsh economic situation in Lebanon is probably the worst in its modern history. Many of those who witnessed the Lebanese civil war say that even during the 15 years of bloody sectarian conflict, the country’s financial and economic situation was much better than today.
Moreover, after the historic & catastrophic Beirut post-explosion on August 4, 2020, many citizens decided to flee the bleeding nation. Many flocked the Canadian, Australian, and many other embassies in an attempt to immigrate once and for all.
Moreover, in Tripoli, North Lebanon’s capital, many smugglers transport people to the neighboring country, Cyprus. Only 164 kilometers away, Cyprus is one of the destinations for desperate Lebanese looking for a new beginning.
The Lebanese currency devaluation and hyperinflation caused many private sector companies to downsize or even completely shut down their businesses.
Fresh graduate’s task to find a new job is near impossible; no one is hiring!
That segment is also eager to leave the country, mostly heading towards stable nations with a strong diaspora presence, like Canada, Australia, France, and more.
On the other hand, the salaries are now worth ten times less than before for those who are still working. For example, someone who earned LBP 1,500,000, equivalent to $1000, lost his purchasing power overnight. Now his salary is worth a mear $170 considering today’s rate.
The Effects On Basic Goods
Adding insult to injury, the prices of goods: Food, clothe, medication, phones, etc… skyrocketed to an unbearable degree.
Bread producers are under extreme pressure while importing flour is backed up by the Lebanese Central Bank for LL1,507.5 for the Dollar; all their additional production expenses are through the roof.
For example, a bakery that owns 80 trucks to transport bread all over the country effectively has to pay for the maintenance cost of those trucks at a rate of LL8,500 for the 1 Dollar.
This is only the tip of the iceberg; the list goes on and on!
Central Bank of Lebanon Cash Dollar Reserves:
According to the Daily Star, the Central Bank of Lebanon will ration spending of the remaining $1.8 billion reserves. Without rationing, the amount won’t last three months as per a source close to the government.
The source leaked much interesting information:
- The government will create a special fund for needy families for $100 million a month.
- Aside from the $1.8 billion for subsidies, the BDL has $17.5 billion in USD reserves that will not be used as they belong to depositors.
- A plan is being discussed to reduce subsidies gradually.
- Wheat and medications will continue to be backed up by BDL.
- Gradual subsidies lift on gasoline and fuel.
That said, what did Riad Salameh mean by saying, “The crisis is behind us”?
The above numbers are merely catastrophic, and the only outcome is additional unrest, poverty, loss of jobs, and so on.
The Lebanese Lira Rate on October 12, 2020:
On Monday, October 12, 2020, the Lebanese pound exchange rate witnessed a huge change. The black markets opened at a rate of 1 USD = 8400 Lira; throughout the day. Rates kept dropping at a dramatic speed until it reached 1 Dollar = 7850 LBP.
Former Prime Minister Saad Al Hariri is conducting what looks to be serious talks for him to be nominated as PM of the new Lebanese cabinet.
After his interview on Sar El Waet with Marcel Ghanem, Saad Al Hariri said he is a normal candidate for the PM position.
In addition to President Michel Aoun, his statement appointing Thursday, October 15, 2020, as the PM parliamentary talks date revived the wheels of political stagnation that governed the country for the past few weeks.
Also, former PM Hariri met with President Aoun on Monday, 12 October 2020. In a statement after the meeting, Hariri said that the talks were “encouraging,” which impacted the currency rate that day. The USD to LBP dropped by a staggering 600 points that day.
Moreover, General Security Director Abbas Ibrahim is touring many GCC countries. He most notably is visiting the USA and meeting key figures from the CIA to the Secretary of foreign affairs up to president Donald Trump himself, some rumors says.
The Lebanese Lira Rate In November 2020:
All the encouraging and positive news propagated in October by the Aoun – Hariri meetings went into flames.
Since early November 2020, the government formation talks went on a downward trend, with political parties making things harder than they should be, as usual!
Most party heads are controlled in some way by a foreign country, be it KSA, USA, Iran, Russia, France, Turkey, to name a few. Also, events happening abroad may affect us, for example, the presidential US elections, which launched a ton of speculation on how the winner’s identity will impact our nation.
The Lebanese Lira witnessed serious devaluation in November, starting with an average Buy 1 USD = 7,053 LL to reach and staggering average of 1 USD = 8,220 LL.
This is an approximate 1,200 LL depreciation per 1 Dollar, to date 20-11-2020.
USD to LBP black market applications and websites developed a new behavior of updating the rates on days supposed to be very slow, like Saturdays and Sundays, even at a late hour of 9:00 PM.
Our observation showed that most of the apps are very active on Sundays, with a constant currency price update on an hourly basis up until night.
These apps claim that their sources are the exchangers themselves and do not relate to them. Do you think that is true?
The fact that all of the apps report up and down rates simultaneously makes them “Suspects.”
Moreover, USD to LBP exchange telegram groups are booming nowadays with buying and selling requests all across the country.
Many financial analysts and economists predict that the Lira will reach the 9,000 LL per US Dollar soon if the government formation stalemate continues.
Adding insult to injury, due to COVID-19, the nation is going through a necessary nationwide Lockdown starting from Saturday, November 14, 2020, till Monday, November 30, 2020.
The last week of November was a disaster in terms of the USD to LBP applications. While they broke the trend of “artificially” increasing the Dollar price on weekends, they increased and decreased the price of the USD by 350 points within less than 24 hours, which is very suspicious.
What kind of a system is governing those apps? Are they using the news or simply adjusting the rates according to their agenda?
November 2020 ended with an average Buy 1$= 8,000 LL.
The Lebanese Lira Rate For December 2020:
November 2020 can be described as a volatile month for the currency exchange. As for December 2020, the USD to Lira rate kept is upward even though most black market apps are laying low.
After many news reports showing how these applications actively manipulate the currency and how most of them are owned, operated, and protected by exchangers or politicians, the apps slowed down the frequency of notifications and reduced the increments values.
One of them stopped showing black market rates, which is the: الدولار عند الصرافين لبنان app.
All of them should be shut down. When PM-elect Saad Al Hariri said the government formation is looking positive before Christmas, the apps artificially dropped the Dollar value by 500 points.
Thankfully, this time the Lebanese people did not run to the black market to sell their cash USDs, unlike in the past.
A smart decision by the Lebanese people, this has become a religiously adopted practice by these apps. Sudden drop of the USD value so that they can suck the fresh Dollars as much as possible.
The 1 USD to Lira started on December 2020 at Buy 1 USD = 8,000 LL to reach today, Sunday 27, December 2020, a rate of 1 USD = 8,350 LL.
We at Liraexchange.com have stopped reporting these app’s rates 2 weeks ago as we do not want to be part of currency manipulation and a bunch of mobsters controlling every one of us.
We might show the rates back just for exposing them and their shady tactics.
Our goal as of December 2020 is to show the Lebanese people how they can generate Cash Dollars working online!
The Lira’s Predictions For 2021:
The complexity of Lebanon’s crisis makes it near impossible to predict how will 2021 look.
We are sure that the “1 USD To Lebanese Lira” topic will get even more complicated and will continue to be a daily nightmare for every one of us.
If the rumors of stabilizing the Lira at 1 USD = 3,900 LL by January 2021 are true, then we are on a path of chaos. The government will have to pay its employees by the new rate, which means the BDL will have to print ridiculous amounts of Lira notes (not to mention the private sector).
That said, the actions that are mentioned above moves against the demand; pumping Lira notes in the market will only speed up its devaluation exponentially.
The outcome of such measures is increased poverty rates, unemployment soaring through the roof, civil unrest, chaos, food shortages, medication shortages, severe electricity outages, and an uncapped currency rate.
Unless a certain new status quo appears, and we get fresh dollars injected from somewhere, the solution is far-fetched.
Thank you for reading this post; we would love to hear your thoughts in the comments box below!