Iranian exporters sell more foreign currency after Rouhani’s warning

Business Materials 10 September 2018 18:00 (UTC +04:00)

Tehran, Iran, Sept. 10


Exporters of non-oil commodities continue to inject more foreign currency earnings into Iran’s secondary currency market after President Hassan Rouhani warned them against the consequences of failing to sell the earned USD in a timely manner, a report said.

Yesterday, the exporters of non-oil commodities sold nearly 212 million euros at NIMA system, the local name for the Integrated Forex Deals System launched by the government after it unified the USD Forex rate in April, Tasnim news agency reported on September 10.

In fact, they hit a record in one day by offering their foreign currency earnings to the digital system. Previously, the exporters, on average, used to sell only 70 million euros at NIMA on a daily basis.

This came after the Iranian president threatened “opportunist” exporters, calling on them to sell their earnings or face the consequences.

The US dollar jumped to as much as 129,000 rials in the open market in the Iranian capital city of Tehran on Monday.

According to reports by Iranian media outlets, a US dollar and the euro, respectively, traded for 135,000 and 158,000 rials in the open market as of Monday afternoon.

A US dollar was worth 36,000 rials in mid-September last year.

One of the main reasons behind the recent fluctuations in Iran’s foreign exchange market is due to US President Donald Trump’s withdrawal from the 2015 nuclear deal between Tehran and world powers in May and the re-imposition of new sanctions.

The Trump administration has warned of consequences for countries including European allies that co-signed the nuclear accord, that do not respect the new sanctions.

On concerns over a return of sanctions, the rial plunged to an all-time low on April 9. In an attempt to stop the fall, the administration of President Hassan Rouhani held an emergency meeting and decided to unify the country’s official and open market exchange rates.

Following the meeting, the government announced the price of the dollar would be 42,000 rials in both markets, and for all business activities. After the protective policy by the government failed to control the prices in the market, the government launched a secondary currency market.

The market again failed to help the government and the administration decided to introduce a new chief for the country’s central bank.

Abdonasser Hemati, the new head, made some changes and allowed licensed exchange offices to buy and sell US dollars and announced that trading the US dollars was no longer considered smuggling.