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Syrian pound at record low, with 1,000 lira to a dollar
The Syrian pound has hit a new record low against the dollar with a freeze on hard currency, impacted by the liquidity crunch in neighbouring Lebanon,
3 min read
A merchant counts money outside his market in a Kurdish majority area [GETTY]
Syrian pound has hit a new record low against the dollar, priced at a value of 1,000 to the dollar at some traders.
The latest crash emerges at the back of a liquidity crunch in nearby Lebanon, which has served as a conduit for hard currency entering the heavily-sanctioned government held areas of Syria.
Exchange offices in Damascus are already selling dollars for 1,000 Syrian pounds for first time on Tuesday, according to the AFP. Three months ago, the pound was trading at 650 against the dollars.
Read more: Syrian pound plummets to lowest rate in history
One specialised website listed the diminishing currency as valued at 975 to the dollar.
This is more than double the official rate of 434 Syrian pounds, found on the website of Syrian central bank. During the outbreak of the war, the rate stood at 48 to the dollar.
In the Old City of Damascus, one trader spoke of how prices had skyrocketed across the board in recent weeks, affecting products and services from food all the way to transport.
"Everybody prices their items according to new dollar exchange rate" on the black market, he explained.
This has encouraged protests among vendors in Syria in government-held areas, which were quickly quashed by the authorities.
The economic downturn in Syria has accelerated after the protests in Lebanon.
The liquidity crunch has impacted Syrian-based business and regime officials, who had profited from the interest generated by their Beirut-based savings.
Lebanese banks introduced controls on dollar withdrawals over the summer, leading to a freeze in the dollar supply in Lebanon, and by extension, Syria.
Read more: Syria Weekly: Banking on Lebanon not paying off for Damascus
A 30-year-old resident of Damascus, working in a shop selling consumer electronics imported from Lebanon, remarked how the store had to increase all prices.
"In the end this is going to be reflected in the market and most people won't be able to pay according to the new prices," the young salesman said.
Eight years of civil war has wreaked havok on Syria’s economy and placed its foreign currency reserves under impossible strain.
Numerous international sanctions have targeted Assad's regime and associated businesses since the outbreak of the war in 2011, causing losses to Syria’s oil and gas sector in the region of $70 billion.
The UN estimates that the war has resulted in almost $400 billion in war-related destruction, 370 000 deaths and millions more displaced.
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Exchange offices in Damascus are already selling dollars for 1,000 Syrian pounds for first time on Tuesday, according to the AFP. Three months ago, the pound was trading at 650 against the dollars.
Read more: Syrian pound plummets to lowest rate in history
One specialised website listed the diminishing currency as valued at 975 to the dollar.
This is more than double the official rate of 434 Syrian pounds, found on the website of Syrian central bank. During the outbreak of the war, the rate stood at 48 to the dollar.
In the Old City of Damascus, one trader spoke of how prices had skyrocketed across the board in recent weeks, affecting products and services from food all the way to transport.
"Everybody prices their items according to new dollar exchange rate" on the black market, he explained.
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This has encouraged protests among vendors in Syria in government-held areas, which were quickly quashed by the authorities.
The economic downturn in Syria has accelerated after the protests in Lebanon.
The liquidity crunch has impacted Syrian-based business and regime officials, who had profited from the interest generated by their Beirut-based savings.
Lebanese banks introduced controls on dollar withdrawals over the summer, leading to a freeze in the dollar supply in Lebanon, and by extension, Syria.
Read more: Syria Weekly: Banking on Lebanon not paying off for Damascus
A 30-year-old resident of Damascus, working in a shop selling consumer electronics imported from Lebanon, remarked how the store had to increase all prices.
"In the end this is going to be reflected in the market and most people won't be able to pay according to the new prices," the young salesman said.
Eight years of civil war has wreaked havok on Syria’s economy and placed its foreign currency reserves under impossible strain.
Numerous international sanctions have targeted Assad's regime and associated businesses since the outbreak of the war in 2011, causing losses to Syria’s oil and gas sector in the region of $70 billion.
The UN estimates that the war has resulted in almost $400 billion in war-related destruction, 370 000 deaths and millions more displaced.
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Follow the Middle East's top stories in English at The New Arab on Google News
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