The Central Bank of Lebanon is moving towards unifying the dollar exchange rate as a prelude to ending the chaos in the financial and monetary market, in line with the demands of the International Monetary Fund and financial institutions and in coordination with the government, which is preparing for a phase of increasing salaries for public sector employees and retirees threefold, along with raising the value of productivity allowance as well.

The decision of the Central Bank of Lebanon to raise the exchange rate from 85,500 to 89,500 pounds comes in parallel with the preparation for the launch of the "Bloomberg" platform, which will officially replace the current exchange platform.

The launch of "Bloomberg" platform is expected take at least three months from now, with the global agency team delaying their arrival to Lebanon due to security conditions.

The newspaper "Annahar" newspaper pointed out that based on this, an agreement was reached between the government and the Central Bank of Lebanon to pay the salaries of public sector employees based on the new exchange rate, considering that the Central Bank of Lebanon buys dollars from the market at this rate.

The decision will also alleviate the impact of the increases that the government will soon approve, after the Council of Ministers decided to postpone their decision yesterday following advice from the acting governor of the Central Bank of Lebanon, Wassim Mansouri, not to expand these increases all at once. The reason is the fear of inflating the cash mass in pounds, which will inevitably leak into the currency market to buy dollars, increasing demand and negatively affecting the pound's rate.

Work is also underway to amend Circular 151. In this context, "Annahar" mentioned that everyone knows that it has entered the delivery room, and preparations have begun to give birth to an amendment or decision coordinated with the government to move to a rate of 89,500 pounds for each "Lollar".

The newspaper said that "the risk of complications and inflammations in the exchange market after starting the imminent amendment is the biggest concern currently for those preparing for the birth."

The newspaper added: "From here, caution walks hand in hand with realism and the enthusiasm of IMF officials, so as not to regret the haste, and so that Lebanon does not lose the monetary stability gained for months, which was established according to the reality of the numbers and the growth movement for people's confidence in the ability if the country managed itself well, to rise strongly and quickly get out of the bottom and make the rescue.

According to what sources from the Central Bank of Lebanon told "Annahar", this measure is nothing but a step towards unifying the dollar exchange rate, knowing that the "Central" is delaying raising the current bank dollar (15,000 pounds for withdrawals), and leaving the matter to the 2024 budget, which will determine the exchange rate of the dollar to be adopted.

Meanwhile, banking sources considered that adopting a rate of 89,500 pounds for withdrawals according to Circular 151 is a big risk that will threaten the stability of the exchange rate as well as the capital of banks and will increase inflationary pressures, especially if the measure is not accompanied by financial and legal controls.

This article was initially published in "Annahar" newspaper, translated by Christina Rai.