'No One Knows' How Much Lebanese Pound (LBP) Could Fall: Official - Bloomberg

'No One Knows' How Much Lebanese Pound (LBP) Could Fall: Official - Bloomberg:

Lebanon’s central bank governor has suggested he’s struggling to contain the divergence of the pound from its peg to the dollar as the country faces its worst financial crisis in decades.

“No one knows,” Riad Salameh said, when asked how much further the pound would depreciate on the black market. “When I spoke in the past, the dollar hadn’t reached 2,000 pounds,” he said, according to the state-run National News Agency. The pound has been pegged at 1,507.5 to the dollar since 1997. Salameh later stressed that the central bank’s policy on the official rate remains unchanged.

Salameh, who’s been at the helm of the central bank since 1993, has repeatedly said the central bank has enough reserves to defend the peg and would maintain the fixed exchange regime.

“The central bank governor may be giving up on combating the black market rate,” said Ziad Daoud, Bloomberg’s chief Middle East economist. “The gap between the official rate and the black market is too daunting to bridge.”