Lebanon's Central Bank committed to stability

Reuters, Tuesday 18 Jan 2011

Amidst political crisis, Central Bank guarantees exchange rate and interest rate stability, assuring Bank will provide necessary liquidity to banking sector

Lebanon's Central Bank remains committed to exchange rate and interest rate stability and will provide the banking sector with any necessary liquidity, a Central Bank statement said on Tuesday.

It quoted Governor Riad Salameh as telling bankers that "the current conditions will not stand in the way of the Central Bank's commitment to stability of the exchange rate and interest rates."

He was speaking in a regular monthly meeting with bankers which coincided with a political crisis in Lebanon following the collapse of the government last week.

Joseph Torbey, chairman of the Association of Banks in Lebanon, said the "banking sector is capable of containing ... and overcoming the situation, wishing that the crisis is not prolonged as it would have a negative impact on the economy," the statement said.

Ratings agency Standard & Poor's downgraded the outlook on Lebanon's B credit rating to stable from positive on Tuesday, saying prospects of economic reform had been damaged by the government's collapse.

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