Credit FAQ: Does Lebanon Have Sufficient Foreign Currency Reserves? - S&P Global Ratings’ Credit Research

Credit FAQ: Does Lebanon Have Sufficient Foreign Currency Reserves?

Credit FAQ: Does Lebanon Have Sufficient Foreign Currency Reserves? - S&P Global Ratings’ Credit Research
Credit FAQ: Does Lebanon Have Sufficient Foreign Currency Reserves?
Published Sep 04, 2019
7 pages (2504 words) — Published Sep 04, 2019
Price US$ 375.00  |  Buy this Report Now

About This Report

  
Abstract:

On Aug. 23, 2019, S&P Global Ratings affirmed its ratings on Lebanon (B-/Negative/B). In our view, the central bank's foreign currency (FX) reserves remain sufficient to fund the government's borrowing requirements and the country's external deficit over the next 12 months. However, we believe there is a risk that customer deposit flows, particularly by nonresidents, could continue to decline, resulting in an accelerated drawdown of FX reserves that would test the country's ability to maintain the currency peg to the U.S. dollar. A continuation of these trends during the next six months could trigger a downgrade to 'CCC' rating category. For more information see "Lebanon Ratings Affirmed At 'B-/B'; Outlook Remains Negative," published on RatingsDirect. Below we address key questions

  
Brief Excerpt:

...September 4, 2019 On Aug. 23, 2019, S&P Global Ratings affirmed its ratings on Lebanon (B-/Negative/B). In our view, the central bank's foreign currency (FX) reserves remain sufficient to fund the government's borrowing requirements and the country's external deficit over the next 12 months. However, we believe there is a risk that customer deposit flows, particularly by nonresidents, could continue to decline, resulting in an accelerated drawdown of FX reserves that would test the country's ability to maintain the currency peg to the U.S. dollar. A continuation of these trends during the next six months could trigger a downgrade to '###' rating category. For more information see "Lebanon Ratings Affirmed At 'B-/B'; Outlook Remains Negative," published on RatingsDirect. Below we address key questions posed by investors regarding Lebanon's FX position, and provide our view on the country's ability to meet FX payments....

  
Report Type:

Commentary

Sector
Global Issuers
Format:
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Cite this Report

  
MLA:
S&P Global Ratings’ Credit Research. "Credit FAQ: Does Lebanon Have Sufficient Foreign Currency Reserves?" Sep 04, 2019. Alacra Store. Jun 24, 2024. <http://www.alacrastore.com/s-and-p-credit-research/Credit-FAQ-Does-Lebanon-Have-Sufficient-Foreign-Currency-Reserves-2292591>
  
APA:
S&P Global Ratings’ Credit Research. (). Credit FAQ: Does Lebanon Have Sufficient Foreign Currency Reserves? Sep 04, 2019. New York, NY: Alacra Store. Retrieved Jun 24, 2024 from <http://www.alacrastore.com/s-and-p-credit-research/Credit-FAQ-Does-Lebanon-Have-Sufficient-Foreign-Currency-Reserves-2292591>
  
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