A complicated Lebanese marriage on the rocks | Financial Times

A complicated Lebanese marriage on the rocks | Financial Times:

Travelling to Beirut in September, air passengers found a paean to a central bank governor in the seat-back pockets in front of them. The in-flight magazine celebrated Riad Salamé’s 25th year at the helm of the Banque du Liban, which owns the national carrier Middle East Airlines — his face was in heroic profile on the glossy black and white cover.

Lauded as an “engineer of stability in a time of crises”, Mr Salamé was particularly praised for his management of the Lebanese lira-US dollar peg, held at about 1,500 lira to the dollar, for more than two decades.

But reports this month that the black-market value of the lira has slipped to 1,560 to the dollar have shaken that reputation. “It looks like he’s losing control of the peg,” said an ex-banker in a smart, semi-deserted restaurant — a sign of straitened times in Beirut’s ostentatious downtown.