BEIRUT: The Central Bank said Monday that it will provide foreign currencies to Lebanese banks to finance the import of basic food items at an exchange rate of LL3,900 against the US dollar.

Banque du Liban will secure the necessary amounts in foreign currencies to meet the needs of importers and manufacturers of basic food products and raw materials that are included in the food industry on the basis of a fixed exchange rate of LL3,900 for the dollar. The requests will be submitted to banks and paid their value in cash in Lebanese pounds to the lenders, which in turn will hand it over to BDL, and the latter will convert them to dollars and transfer them to the correspondent banks accredited to them, a statement by BDL said.

All import applications submitted prior to this date will be approved according to Intermediate Circular No. 557 dated May 27, 2020, on the basis of a fixed exchange rate LL3,200 for the dollar.

The official price of the dollar remains at LL1.515 according to the statement.

But the statement did not specify when the new foreign currency cash injection will start although the Central Bank governor said the new mechanism will be applied this week.

The statement did not also say how much cash will be injected into the commercial banks.

The Economy and Trade Minister Raoul Nehme plans to unveil a list of 280 food items which will be subsidized by the Central Bank.

The purpose of the new subsidies will be aimed at reducing the prices of food items and other essential products for the consumers.

The exchange rate of the dollar in the black market was close to LL9,200 Monday although these rates fell to LL7,500 against the dollar Friday.

But most economists argue that the dollar rates will continue to surge haphazardly if the confidence in the economy and the national currency is not restored.

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