The money supply increased by 17.7% in the first 4 months of the year, says the Banque du Liban. Now 34,420.7 billion Lebanese pounds are said to be in circulation, an average increase of 1,726 billion monthly during this period.
This increase in the money supply implies a deterioration in the value of the Lebanese pound, observers note and thus explains a large part of the rise in prices in recent months.
It was induced on the one hand by the monetization of public deficits and also by the effects of the various circulars of the Banque du Liban including circular 151 which allowed banks to allow depositors to have dollar accounts at the rate of LL 3,900. / USD. Since then, Circular 154 which allowed the central bank to sell foreign currencies could further worsen the situation.
