The Lebanese pound fell to a new low against the U.S. dollar on the black market on Monday as a severe economic downturn sparked bank heists by angry depositors and anti-government protests.
Recent weeks have seen a series of incidents in which people armed with real or fake weapons have robbed banks to demand access to their frozen savings, only to be celebrated as folk heroes.
Amid the turmoil, the pound plunged to 38,600 against the greenback on Monday, according to websites monitoring the exchange rate, a record high for the beleaguered currency.
For decades, the Lebanese pound has been pegged at 1,507 to the dollar, meaning it has lost around 95% of its value on the black market since 2019.
At the Beirut courthouse on Monday, dozens of people marched through a metal door outside to protest the detention of two people following last week’s bank robberies.
Elsewhere, activists angered by Lebanon’s deep economic crash blocked roads in the capital and the northern port city of Tripoli.
A financial crash widely blamed on government corruption and mismanagement has caused the worst economic crisis in Lebanon’s history.
Lebanese banker Saeb El-Zein said the pound’s decline was due to growing demand for dollars on the black market following the government’s decision to lift state subsidies, including on fuel.
– ‘Slow progress’ –
With four out of five Lebanese now living in poverty according to the United Nations, the country is desperate for a bailout from the International Monetary Fund.
An IMF delegation arrived in Lebanon on Monday to follow up on the implementation of the reforms it demands, following a staff-level agreement in April on a $3 billion loan program.
“There has been slow progress in implementing some of the critical actions that we believe are necessary to move a program forward,” IMF spokesman Gerry Rice said last week.
Amid the painful crisis, Lebanese depositors have been barred from their foreign currency savings by banking controls that have gradually tightened since 2019.
In the past, banks have been the target of street protests, often leaving their windows and ATMs smashed.
Now many frustrated depositors, unable to transfer or withdraw their dollar deposits, have resorted to desperate bank robberies to free up their money.
Lebanon has seen at least seven such robberies in the past week, including five in a single day.
As a result, Lebanese banks closed on Monday as part of a three-day shutdown amid growing security concerns.