Lebanese government raises subsidised bread prices as currency tumbles

The Lebanese government on Tuesday raised the price of a 900-gramme loaf of partially subsidised bread to 2,000 pounds from its pre-October-crisis price of 1,500 pounds.

The pound, which is officially pegged at 1,500 to the dollar, has lost over 80% of its value since October and is now trading at nearly 9,000 to the dollar on the black market after sharp falls in recent days.

Since October Lebanon has been in a financial crisis that has seen businesses close and prices and unemployment soar.

The crisis is seen as the worst threat to its stability since the 1975-90 civil war.

READ: Lebanese face food crisis due to economic collapse

The heavily indebted country has maintained an official dollar peg of 1,507.5, but dollars at this level have been rationed exclusively for imports of fuel, medicine, and wheat.

In recent days there have been long queues in bakeries as oven owners stopped selling their bread to shops, complaining that their production costs had spiralled due to the rapid depreciation in the value of the pound.

Bakeries also threatened to stop bread distribution, saying they were losing money.

The bread crisis sparked renewed anti-government protests on Saturday and Sunday as demonstrators blocked main highways across the country.