Press Today

Lebanon steps up fiscal engineering to buy time in crisis

Dana Khraiche|- Lebanon’s worst economic crisis in decades is forcing authorities to wade deeper into the kind of fiscal engineering that the International Monetary Fund said risks undermining the Central Bank’s credibility. The Central Bank bought 3 trillion pounds ($2 billion) of Treasury bills from the government at 1 percent, well below market rates, according to a person
with knowledge of the matter. It’s expected to buy half as much again at the same rate by the end of the year to reduce the government’s rising debt costs, the person said on condition of anonymity because the issue is sensitive. The deal helps offset higher interest rates incurred by the Finance Ministry, which last month sold $3 billion in Eurobonds to the Central Bank at as much as 12 percent.
Read full article