Currency collapse, Lebanon hikes bread price for third time in nine months

Beirut: Lebanese authorities announced late Tuesday a bread price hike, the third in nine months, a move the government blames on a plunge in the value of the local currency.

The economy ministry announced that the price of 960 grams of bread would be set at 3,000 Lebanese pounds, up from 2,500 pounds, the state-run National News Agency reported.

The move means the price of bread has more than doubled since May last year, as the country grapples with an unrelenting economic and political crisis that predates the coronavirus pandemic.

In justifying the latest hike, the ministry pointed to an ongoing failure to form a new government driving a "sharp fall in the Lebanese pound against the dollar".

Pound plunge

The pound is currently trading at about 11,000 to the dollar on the black market, compared with the official rate pegged at 1,507.

The consequent erosion of purchasing power has fanned anger in a population that has long viewed the ruling elite as irretrievably corrupt.

The rapid currency plunge - the pound fell as far as 15,000 at one stage last week - has reignited street protests that started in 2019 before they were temporarily snuffed out last year due to the coronavirus pandemic.

More than half the population lives in poverty, according to the UN.

The latest bread price hike comes the day after a crucial meeting between President Michel Aoun and prime minister-designate Saad Hariri in which the two failed to agree a new government line-up after months of deadlock.

At the end of last year, inflation was running at annual 145.8 percent, according to official statistics.