Lebanon’s central bank said on Thursday it would sell US dollars to commercial banks at the rate on its Sayrafa foreign exchange platform, but analysts said offering more hard currency would do little to steady the already crippled Lebanese pound.

Lebanon’s economy has been in freefall since 2019, when a mountain of debt and political gridlock, drove the nation into its deepest crisis since the 1975-1990 civil war.

The Lebanese pound, which was exchanged freely at 1,500 to the dollar before the crisis, has collapsed to around 25,000 on the unofficial market. On the central bank’s foreign exchange platform, known as Sayrafa, Thursday’s rate was 22,300.

Beirut-based financial adviser Mike Azar said the central bank’s latest move was “to stabilise the lira but an insolvent bank that is bleeding FX … cannot stabilise the currency by market intervention. It has no credibility.”

As Lebanon plunged into crisis, depositors – many of whom had dollar accounts – were locked out of their savings and only allowed to withdraw them in Lebanese pounds at a rate that was far below the unofficial exchange rate on the street.

Last week, the central bank said depositors withdrawing from their dollar accounts would receive Lebanese pounds at a rate of 8,000 to the dollar, an improvement on the previous rate of 3,900, but still well below the street rate or Sayrafa rate.

In Thursday’s statement, the central bank said depositors could use Lebanese pounds they had withdrawn to buy back dollars but at the Sayrafa rate, effectively meaning they receive a roughly 70 per cent ‘haircut’ on the value of their original dollar deposit.