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Lebanese economic activity to remain slow in coming months

BEIRUT |, with agencies - April 22, 2012, 11h13
Photo: AFP
The Lebanese economy continues to suffer from the impact of regional unrest as reflected by recently released indicators, Lebanon This Week stated, while quoting Business Monitor International.
The Lebanese Central Bank's monthly Coincident Indicator contracted by 1.8% year-onyear in January 2012, which pushed the three-month moving average to a nine-month low of -0.1%, According to the Business Monitor International.

The Coincident Indicator is a measure for the underlying health of the economy given the absence of timely official GDP data. According to BMI, the number of transactions in points-of-sale expanded by just 0.7% year-on-year in January 2012 relative to growth of 0.4% in December 2011, which reflects ongoing weakness in private consumption. It indicated that the growth in the three-month moving average of cement deliveries and construction permits reached a multi-year low of -11.1% and -7.7% year-on-year, respectively, in January.

BMI considered that the current economic slowdown is broad based, with consumption, trade and investment indicators all pointing to an economy fluctuating on the edge of recession. It said that Lebanon's economy has been affected by the ongoing crisis in Syria despite having avoided any incidence of large-scale public unrest associated with the Arab Spring.

It expected economic activity to remain depressed in the coming months given the low prospects for a lasting resolution to the Syrian conflict over the near term. However, it anticipated the ongoing rise in global oil prices to have a positive impact on the Lebanese economy through higher remittance inflows, an increase in bank deposits, and a rise in investments from Gulf countries.
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