The Lebanese Central Bank’s balance sheet conveys some $379.84 million contraction in its foreign assets portfolio during the first half of October 2019 to $38.13 billion, down from $38.51 billion a fortnight ago. When factoring out BDL’s portfolio of Lebanese Eurobonds amounting to $3.3 billion as per the disclosure made by the Central Bank, the latter’s foreign currency reserves would settle at $34.83 billion by mid-October, compared to $35.21 billion at end of September. On the other hand, the value of gold reserves at BDL rose by 0.50% ($68.43 million) in the first half of October to $13.79 billion amid a spike in international gold prices following the release of weaker-than-expected U.S. economic data (most notably the ISM Manufacturing Purchasing Managers Index and private payroll data), which raised further concerns of a looming recession. Gold prices were also supported by the failure to reach a satisfactory Brexit deal, with its deadline drawing near. A negative correction in gold prices followed through after appeasing U.S. economic data were later published, yet such downturn was interrupted again in light of an attack on two Iranian oil tankers.

On an annual basis, BDL’s foreign assets came in 11.56% ($4.99 billion) lower than the $43.12 billion reading reported at mid-October 2018. Conversely, the value of gold reserves soared by 21.38% ($2.43 billion) when benchmarked to the $11.36 billion figure recorded in the same period last year. It is worth noting that BDL’s total reserves (foreign currency and gold) cover some 114 months of debt service and constitute around 56.35% and 62.67% of Lebanon’s gross and net public debt on a respective basis.

In a related note, BDL’s balance sheet widened by $791.22 million during the first half of October to $136.16 billion owing to some 2.23% expansion in the value of other assets to $34.76 billion, coupled with a 1.16% increase in the value of the securities portfolio to $34.19 billion and a 0.50% improvement in the value of gold reserves to $13.79 billion, which altogether outweighed the 0.99% drop in the value of foreign assets to $38.13 billion and the 0.30% decline in loans to the local financial sector to $15.02 billion.

The share of BDL’s foreign assets of the latter’s total assets fell to 28.01% by mid-October 2019, compared to 28.45% at end of September, with that of gold reserves remaining almost flat at 10.13%.