Lebanon Reverses Dollar-Deposit Rule After Night of Confusion

Lebanon scrapped a new dollar-deposit rule on Thursday that triggered minor street protests and meant savers lost the ability to change their money at a more favorable rate, Bloomberg News reported. A day after the Shura Council, the country’s top judicial body, banned a long-standing rule allowing depositors to access their dollars at a rate higher than the official currency peg, Riad Salameh, the governor of Banque du Liban, said the decision was being revoked. The rule “is still in effect,” Salameh told reporters in Beirut after meeting with the president and the head of the council. The decision to ban higher-rate withdrawals had sent shockwaves across the Mediterranean nation on Wednesday, triggering minor demonstrations in Beirut. Banks stopped dispensing dollars over a year ago after a shortage of foreign currency and a plunge in central bank reserves rattled the financial industry. Some lenders initially failed to comply with the suspension, continuing to give depositors 3,900 pounds per dollar instead of the pegged rate of 1,500 pounds. Others stopped dispensing funds for a few hours in the morning before resuming later. Read more.
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