Contrary to warnings that the Lebanese currency would sharply collapse after Salameh’s departure, Mansouri was able to control the exchange rate. This month, the central bank paid public sector salaries in dollars by purchasing dollars from the market with Lebanese pounds transferred by the government for this purpose. The biggest problem is that the size of the credit was so large that it depleted the central bank’s hard currency reserves, reaching the people’s deposits. The central bank cannot keep buying dollars from the market indefinitely. “As long as I control the monetary supply at the central bank, there is no fear of a fluctuation in the dollar exchange rate,” he remarked.

Source: The North Africa Journal September 03, 2023 09:16 UTC