Rial regains as Iran’s CBI puts brakes on dollar

A new wave of devaluation for Iran’s rial seems to have come to an end as the Central Bank of Iran (CBI) resumes rationing the US dollar while it dismantles price restrictions in two government-run exchange markets.

15 September 2020
ID : 22567
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A new wave of devaluation for Iran’s rial seems to have come to an end as the Central Bank of Iran (CBI) resumes rationing the US dollar while it dismantles price restrictions in two government-run exchange markets.

The official IRNA news agency said that CBI efforts to strengthen the rial finally put the brakes on the greenback on Monday as it was selling 260,000 against the rial in late afternoon trade in the unofficial exchange market.

The dollar had surged to fresh highs late last week when it rose nearly 10 percent against the rial compared to early in September.

That was a fresh low for the rial which has devalued more than 500 percent in the past four years.

The government maintains an official price tag of 42,000 for the rial against the dollar which it mostly uses for imports of staples and medicines.

It has dismissed concerns about the falling value of the national currency, saying much of the devaluation has taken place because of illegal speculative trade in the market.

The report by IRNA said that a former scheme for rationing the dollar, which earmarks $2,200 dollars on the official price to each Iranian citizen every year, was resumed early on Monday nsion, allowing the CBI to partially contain the prices in the unofficial market.

To further control the prices, the CBI also removed a price cap mechanism in its secondary exchange market, known as NIMA, where exporters sell their foreign currency proceedings to importers.

It also dismantled the official price tag from its sanctioned exchange dealers to control the speculative trade, said the report by IRNA.

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