Volatile market kills off hopes for currency rates' unification in Iran
Baku, Azerbaijan, March 22
By Farhad Daneshvar - Trend:
Recent currency fluctuations in Iran have cast shadow over plans devised by the monetary policymakers to unify exchange rates in the Middle Eastern country.
Valiolah Seif, the governor of the Central Bank of Iran (CBI), earlier said that the country's currency market has calmed down after several weeks of turmoil that shot the rates of foreign currencies through the ceiling.
The currency market over the past month has witnessed a rare volatility with the US dollar nearing 50,000 rials in mid-February and dropping to 44,590 rials in early March.
The stability of the currency market came after CBI combined its package, which includes a significant deposit rate increase, with a police crackdown on unregulated currency traders.
Despite repeatedly renewed promises by Iranian financial policymakers on unifying the country's official and open market exchange rates, the issue of parallel exchange rates has remained in place.
The CBI since 2012 has repeatedly said it is going to eliminate the multi-tier exchange rate in the country, but it has achieved no obvious results so far.
The former governor of Central Bank of Iran (CBI), Tahmasb Mazaheri, in a recent interview with Trend called for the unification of currency rates, saying it is vital to introduce a single currency rate in the country.
Postponing the plans for introducing a single currency rate would impose more damages to the country’s economic system, he added.
In the meantime, Chairman of Tehran Chamber of Commerce, Industries, Mines and Agriculture (TCCIMA) Masoud Khansari has criticized the CBI over its failure to realize the task of unifying currency rates in the country, saying this seems impossible in the current market situation.
ISNA news agency also in a recent report suggested that the US dollar is offered at different rates in several shops in Tehran, turning down the possibility of introducing a single rate in the current situation.
There is about 20-percent difference between the official and free-market exchange rates of the US dollar in the current situation in Iran.