Lebanon’s pound traded at a record low of more than 35,000 to the dollar on Thursday, according to currency exchange platforms and traders, as divisions within a newly-elected parliament fuel concerns political paralysis will worsen the country’s financial crisis.
The legislature elected on May 15 has yet to hold its first session with major blocs divided over who to elect as speaker of parliament.
The country clinched a provisional agreement with the International Monetary Fund in April but several measures prerequisite to the release of funds, including amendments to banking secrecy regulations and a capital controls bill, have yet to be adopted by parliament.
The pound has lost more than 95 per cent of its value since 2019, when it was valued at 1,500 just before the country tumbled into an economic meltdown.
Lebanon’s three-year financial crisis has pushed three-quarters of the population into poverty and food prices have gone up more than 11-fold, with new price hikes seen in supermarkets this week.
After decades of pegging the currency, the central bank now offers multiple rates, including a flexible exchange rate that was trading around 25,000 this week.
The gap between market exchange rates and the central bank’s rate has widened significantly since the May 15 elections.