Between mid-February and the end of March, Lebanon's central bank foreign currency reserves dropped from $12 billion to $11.5 billion.
That is more than half a billion dollars in six weeks, just to maintain relative stability at an exchange rate of 89,500 lira to the dollar, or essentially to buy time.
Lebanon is approaching a decisive point not only politically but also economically, and its dilemma is not simple: if the central bank continues to sell dollars to the market, the reserves will continue to erode due to insufficient foreign currency income.
If it stops and allows the lira to trade freely on the market, a sharp and rapid devaluation will occur, and then the impact will shift to prices, wages, and generally to the state's ability to function. It is no coincidence that one newspaper wrote today that the central bank governor is "crazy" if he allows such a devaluation.