Lebanon to Slash Official Exchange Rate from Nov. 1, Finance Min Says

Lebanon to Slash Official Exchange Rate from Nov. 1, Finance Min Says

Lebanon plans to slash its official exchange rate, replacing the 1,507 per dollar rate adopted 25 years ago with a rate of 15,000 in a step towards unifying numerous exchange rates, the finance minister told Reuters on Wednesday.

The pound has plunged by more than 95% from the official rate since Lebanon fell into financial crisis three years ago, with dollars currently changing hands at around 38,000 on a parallel market.

"The goal is for there to be a unification of the exchange rates in Lebanon," Finance Minister Youssef Khalil said, calling the decision a "fundamental step" in that direction. The step would come into force on Nov. 1, the ministry said.

"Today, Lebanon has entered a new phase and is no longer using an official US dollar exchange rate that makes no sense ... Now we have one that is useful, based on which you can steer the economy toward a better situation," he said.

The decision - which Khalil said was agreed with central bank governor Riad Salameh - marks a milestone in the meltdown that has plunged swathes of the population into poverty in the worst crisis since the 1975-90 civil war.

Ruling politicians have so far taken scarcely any action towards