All monetary aggregates ended the week of February 23, 2023 on a positive note. The overall money supply, “M4”, remained nearly flat on a weekly basis at LBP 1,232.83 trillion, notwithstanding the LBP 157 billion decrease in the non-banking sector’s Treasury bills portfolio during the concerned week. It is worth noting that as of the beginning February 2023, the official exchange rate was adjusted to LBP 15,000 per US Dollar.

In parallel, Lebanese-Pound denominated deposits and currency in circulation, “M1”, increased by LBP 2,611.72 billion week-on-week to LBP 96,122 billion on the back of some LBP 3,179 billion rise in currency in circulation which outweighed the LBP 567 billion decrease in demand deposits. The increase in the “M1” monetary aggregate can be partly explained by the rise in currency in circulation outside the Central Bank on BDL’s balance sheet at a time when the latter was printing LBP banknotes to purchase USD banknotes from the black market. Local currency term deposits, “M2”, also increased by LBP 2,908.00 billion on a weekly basis to settle at LBP 114,243 billion.

Consequently, private sector term and saving deposits denominated in LBP (“M2-M1”) widened by LBP 296.29 billion (1.66%) to LBP 18,121 billion during the week of February 23, while deposits denominated in foreign currencies (“M3-M2”) sank by LBP 2,734.47 billion (0.25%) to LBP 1,099.53 trillion.