Iran to put more dollars on market

Business Materials 27 May 2011 18:29 (UTC +04:00)

Azerbaijan , Baku, May 27 /Trend/

Iran will insert more U.S. dollars on market to meet high demands for foreign currency, Fars News Agency reported quoting Governor of the Central Bank of Iran Mahmoud Bahmani as saying.

"Increase of the value addedtax has caused high demands for dollar in currency market. The Central Bank of Iran put dollars on market on Saturday to prevent further damages," he said.

Reasons causing strike in Iranian currency market are still unclear, while the banks have decreased the volume of dollar supply recently.

CBI will put more dollars on market and the price of dollar will drop considerably in the future, Iranian official predicted.

"It would be better if the liquidity in the country moved to buy gold not dollar, because the gold has intrinsicvalue," he added.

The exchange rate of dollar was 12,000 rials on Iran's exchange market, demonstrating a 14.29 percent rise.

Increase in U.S. dollar rate in Iran is explained by drop in its supply on foreign currency markets.