Financial and banking sources informed "Al-Markaziah" that the Central Council of the Central Bank of Lebanon is likely to extend Circular 161 in its session scheduled for tomorrow, Wednesday, at the Central Bank. This circular pertains to the payment by banks to depositors of cash withdrawals they are entitled to, whether in Lebanese pounds or US dollars, according to the limits set by each bank. The withdrawals should be in fresh dollars based on the exchange rate on the Sayrafa platform from the previous day. This measure aims to keep the dollar under control in the parallel market by withdrawing pounds and injecting dollars in return.
Previously, the Central Council had extended the implementation of this circular until the end of July. However, it remains unclear whether the council intends to extend it for a month or longer, particularly given the anticipated political developments that the Central Council will take into account. These include the inability to form a new government, the upcoming presidential elections set to start in the parliamentary council from September 1, and the final agreement with the International Monetary Fund.
The financial and banking sources state that "these political events require financial stability, and one of the tools for this stability is Circular 161." They add that the Central Council is compelled to extend the circular, especially since the recovery plan has not yet been approved and the necessary reforms to put the economy on the right track have not been initiated. The sources acknowledge that what the Central Council is doing "is merely a painkiller while waiting for the implementation of the plan and restructuring of the banking sector, as well as determining who will bear the losses exceeding $70 billion."
