Monday, September 10, 2012

Iran Central Bank Not Defending Rial - MP

Gholamreza Mesbahi Moqaddam, the chairman of Majlis Economic Committee, said today in Tehran that the Central Bank of Iran (CBI) has stopped supplying the foreign exchange shops with dollars, helping push the national currency, the rial, into a free fall; with rial being traded at historic lows against dollar.

Moqaddam did not explain the reasons behind the CBI move, which according to him started three weeks ago. The dramatic loss of oil revenues, the country’s major source of hard currency, due to current sanctions, is believed to be the main reason; CBI seemingly does not have enough foreign exchange available to defend the value of the national currency.

The private foreign exchange shops are officially licensed to operate by the CBI and purchase their dollars either from businesses and retail customers who want to sell or directly from the CBI. But in the country’s uncertain atmosphere, the tendency on part of businesses and ordinary citizens is to accumulate dollars and not selling them, making CBI the only reliable source for the open markets to get the bulk of their foreign exchange supplies. The CBI also uses these exchange markets to defend the value of rial, by selling large amount of dollars; a path, however, that it’s been unwilling and now reportedly unable to follow. 


Anonymous said...

The Iranian currency must be based on Energy (not Gold, not Debt); that would be a real and innovative solution; but it is not clear if the current Regime can pursue a clearheaded policy

Unknown said...

With oil revenue less than half of what it used to be, it's not a matter of not wanting to intervene, the ICB simply can't intervene!

Anonymous said...

Try telling that to the IRI Parasites that the economy is near collapse.
Firing a few missile and launching a rocket into very low earth orbit doesn't mean the economy is well.
That's what the Soviet Union did, only a thousand time better.


Anonymous said...

Anon 7:28PM

"If no bread the government..."

The government will invent a bread!!!
People who live in the Islamic Republic are smart enough, and by their patience they will waitover any outside stupidities !!!

Anonymous said...

Anon 4:22 AM

It's easy for a brain washed regime stooge to defend the Ayatollahs incompetence.

But the fact remains:


Anonymous said...

"The government will invent bread!!!"

Ha Ha Ha Ha!!
How can the "government" invent bread when bread was already made 5000 years ago?!
Looks like the "government" is good at inventing lies!