High demand for the dollar…and the reason?

Fouad Bazzi wrote in Al-Akhbar newspaper: For limited hours the night before yesterday, there was a demand for the dollar. The source of the demand is that there are quantities of the lira that accumulated in the safes of commercial institutions over the course of five holiday days, and in conjunction with the spread of the state of uncertainty and fear of the outbreak of war, this mass has begun to put pressure on the exchange rate.

Informed sources say that this demand was met through the mechanisms that were established in the market during the past two years, that is, through the networks that the Bank of Lebanon deals with to buy the dollar or sell it in the market. The demand was mainly concentrated in northern Lebanon, where the largest number of public sector workers reside. They receive their salaries in dollars, but they rush to convert them into pounds through money changers spread throughout the neighborhoods at a price that exceeds between 500 and 600 pounds per dollar compared to the supermarket price. For this reason, they pay for their purchases in liras, and merchants in that area collect a lot of liras, especially on consecutive holiday days. But with doubts about the possibility of widening the scope of the response and mutual response between Iran and the Zionist entity, it is no longer possible to keep the lira.

Thus, a calm in the spare parts market that lasted for about 8 months ended. But this calm was not reflected in the exchange rate, as according to informed sources, the parties that the Bank of Lebanon deals with to collect dollars bought all the liras offered on the market and pumped the dollars they collected in recent days and have not yet delivered them to the Bank of Lebanon.

The owner of one of the banking shops in Tripoli, Muhammad Al-Abyad, does not believe that the problem lies in the mass of salaries of public sector employees in the north because “they do not exceed $3 million per month,” but he points out that a request was registered from a bank, two weeks ago, in the amount of $3 million. . Al-Abyad accuses the unlicensed money changers of spreading rumors in the market that create confusion and spread terror among people. He says that uncertainty still dominates the atmosphere, as the actual size of demand for the dollar will not become clear “before shops and markets return to work after the holiday, that is, today, Monday.”

Record demand for the dollar was not limited to the north, but was greater there. In a number of areas, such as Nabatieh, Sidon, and the southern suburb, a number of money changers reported a rush to buy dollars, “in amounts ranging between $500 and $4,000 in each transaction,” says money changer Mahmoud Issa. This type of operation was not limited only to individuals, but was carried out by commercial institutions that did not close their doors in all of Lebanon during the holiday, such as bakeries and restaurants, and “they are the most capable of influencing the exchange rate,” according to Issa. After accumulating a mass of liras that she had due to people’s demand to go there during the Eid days, she requested to buy dollars and quickly replace her stock with the deterioration of the situation in the region, as “one of the famous restaurants bought 100 thousand dollars at once at midnight on Saturday,” Issa concluded. .