The Lebanese foreign exchange market was relatively quiet last week, February 9, characterized by subdued trading. Central Bank intervention in supplying dollars was very limited, as demand for the U.S. currency has come down significantly since the Israeli elections and the victory of the right-wing leader Ariel Sharon.
Investors are tending to remain on the sidelines during the transition period between governments in Israel, with little on the domestic scene to divert their attention. Interbank trading ranged between LP1,513.75-14.25 at the close compared to LP1,513-14 last week.
Purchase subscriptions in local treasuries fell 25.7 percent to LP384.2 billion ($254.8 million) on February 1, while the amount of maturing TBs dropped some 14 percent to LP290.25 billion ($192.5 million), thus resulting in an LP93.95 billion ($62.3 million) purchase surplus.
Demand at the weekly TB auction has been relatively low, with talk circulating of the Central Bank being the major buyer of new LP government paper. Again, and for the third consecutive week, investors increased their attention in long-term treasuries, as subscriptions in the 24-M TB jumped 18 percentage points on a proportional basis to 58.9 percent of total purchases, while the share of the 12-M TB dropped 16.22 percentage points to a weight of 14.58 percent.
On the other hand, the share of the 3-M TB edged up 3 percent to 15.39 percent of subscriptions, while that of the 6-M TB fell by some 5-percentage points to a weight of 11.12 percent. The Central Bank sold LP2 billion ($1.33 million) worth of 60-day certificates of deposit this week at steady interest rates. — ( Banque du Liban et d'Outre-Mer Sal )
© 2001 Mena Report (www.menareport.com)
