Lebanon Inflation Rate Surges to 211%, Economist Steve Hanke Recommends a Currency Board

1年前
标签:比特币0759
文章来源: bitcoin.com

As political leaders in crisis-hit Lebanon bicker over positions in the yet-to-be-formed government, the country’s runaway inflation rate surged to 211% in May 2022, new data has shown. Economist Steve Hanke insists that a currency board is a solution to Lebanon’s currency woes.


The inflation rate in crisis-torn Lebanon surged to 211% in May, making it the 23rd consecutive time the consumer price index (CPI) has surged, a report has said. The revelation of the latest inflation figure comes as the country’s politicians reportedly struggle to form a new government more than a month after parliamentary elections.


According to a National News report, the politicians’ failure to create a new government is delaying the implementation of key reforms that allow Lebanon to receive a $3 billion bailout from the International Monetary Fund (IMF). The report also quotes a note from Byblos Bank that attempts to reveal factors likely to be worsening the inflation situation. The note asserts:


The bank reportedly added that the smuggling of imported products, as well as the emergence of a black market for fuel, had contributed to the latest surge in the inflation rate. As noted in the report, transport costs alone had in a period of 12 months gone up by 515%. The health sector had the second highest surge as prices have gone up by 468% during the same period.



The National News report also asserts that Lebanon, whose public debt now exceeds $100 billion, needs to have a government in place in order for it to access a further $11 billion that was pledged by donors in 2018. Nevertheless, this funding only becomes available once the required reforms have been carried out.


Lebanon Inflation Rate Surges to 211%, Economist Steve Hanke Recommends a Currency Board


Meanwhile, Johns Hopkins University professor and economist Steve Hanke recently argued in a tweet that an IMF bailout is not going to stop what he called “Lebanon’s economic death spiral.” Instead of attempting to rescue a collapsed currency, Hanke recommends a currency board.


“Since Jan 1st, 2020, the Lebanese pound has depreciated 92% against the USD. The Mikati government won’t stop Lebanon’s economic death spiral with a flawed deal with the IMF. The only way for Leb to establish confidence & stability is to install a Currency Board,” the economist argued.


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