The New York Times reported today that because of EU sanctions, Iran is facing a strange problem of not being able to print money. The European companies that have been providing currency production services to Iran say they have stopped doing business there. Koenig & Bauer AG of Germany, for example, said it has not responded to an Iranian request for bids to make the presses to print new rials.
It is believed that denying the Central Bank of Iran the ability to increase the supply of money during a period that inflation is eroding the rial’s purchasing power would hasten the economic crisis facing the country. But limiting the rial circulation could also have the opposite effect of preventing hyperinflation.
File photo: ISNA