BEIRUT: The Central Bank’s foreign currency reserves up to June of this year fell to $28.3 billion from 30.37 billion in same period last year, the Association of Banks in Lebanon said Thursday.

ABL noticed that the demand for the U.S. dollar increased in the first six months of 2011 but the conversion from Lebanese pound to foreign currencies was not too alarming.

The ratio of dollar deposits in Lebanese banks jumped to 66.8 percent up to June 2011 from 63.2 percent in the same period of last year.

ABL stressed that the tense political situation and regional turmoil has negatively affected most economic indicators in the first six months of this year.

However, the association hoped that the economic indicators would become more positive in the second half of this year following the formation of the Cabinet headed by Prime Minister Najib Mikati.

The balance of payment in the month of June alone recorded a surplus of $564 million but the accumulated balance of payments in the first six months registered a deficit of $480 million.

ABL attributed the deficit in the balance of payments in the first six months of this year to the fall in the size of remittances and capital inflow.

As a result, total bank assets in the first six months of this year only climbed to LL204,160 trillion compared to LL202,067 trillion in the first six months of last year.

Lebanese banks continued to record some reasonable growth this year although at a much lower pace than previous years.

Tourism, exports, and real-estate sales have all seen a sharp drop in the first few months of this year and analysts fear that the economy will continue to suffer as long as the deep political rift and regional tensions persist.

Economists and investors are pressing the government to pay more attention to the economy and cast aside all political differences.

Observers are eagerly awaiting the 2012 draft budget which is being hammered out by Finance Minister Mohammad Safadi and his team.