Currencies across the Middle East witness shock decline as economic woes worsen

Currencies across the Middle East witness shock decline as economic woes worsen
Currencies in Lebanon, Egypt, Iraq and Syria have continued to slide against the US dollar with record-breaking lows, due to a number of factors such as continued mismanagement, corruption, and the Ukraine conflict.
2 min read
26 January, 2023
The Lebanese currently stands at 61,000 liras to the US dollar in a new low [Getty]

Currencies in multiple Middle Eastern countries are witnessing massive, unprecedented drops relative to the US dollar as the region continues to reel from worsening economic crises and rising inflation.

The Lebanese pound, which has lost 97 percent of its value since the onset of a financial crisis in 2019, has dipped to a record-breaking 61,000 to the US dollar, according to currency converters.

On Wednesday, the currency had already plunged to 56,000 liras to the dollar - a 10,000 lira decrease from the previous week. In just one day, that has increased by 5,000 liras.

The currency’s shock plunge prompted angry Lebanese to protest in the capital Beirut. They blocked key roads and burned tires near the country’s central bank, demanding government action.

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The Egyptian pound has also experienced an unprecedented slide, decreasing to 31.7 to the dollar. Earlier this month, the Egyptian pound saw its largest single-day slide since the government agreed to a $3 billion deal with the Internatinonal Monetary Fund in December last year.

Egypt’s economy suffered following Russia’s invasion of Ukraine, which saw investors pull billions out of the country. Prices of basic commodities such as bread also rose greatly.

Many Egyptians are struggling to get by, unable to afford meat, eggs and bread - prompting them to adapt to new eating habits.

The Iraqi dinar has also declined tremendously against the US dollar in recent weeks, causing a hike in prices of imported goods and thrusting the corruption-ravaged country into a deeper recession.

The currency’s value once stood at 1,182 dinars to the dollar, but this has now fallen to 1,460 to the dollar as of Wednesday, prompting anger across Iraq.

Meanwhile, the Syrian lira has also taken a nosedive against the US dollar. Syria is in the midst of an economic crisis caused by a brutal war which has destroyed much of the country's infrastructure and ongoing regime coruuption, as well as international sanctions. 

The lira has hit a record low, currently standing at 6,690 to the US dollar. In March last year, the currency plunged to 4,000 relative to the dollar, in the wake of Russia’s invasion of Ukraine.

Unresolved economic issues, worsened by the coronavirus pandemic and the Ukraine conflict have largely contributed to the currencies’ downfall alongside mismanagement, internal political issues and corruption.