Struggling to bring some semblance of stability to the turmoil gripping the currency market, the Central Bank of Iran said it was again pumping cash to stabilize the situation.
In a press release published on its website on Monday, the CBI said it had increased forex offer at the secondary foreign exchange market by 27% compared to the earlier session.
Known by its Persian acronym, Nima, the secondary market is a trade platform where exporters sell their forex earnings and importer buy it for import needs.
The CBI noted that it had sold more than $85 million to selected moneychangers in the regulated forex market.
On Sunday, the CBI raised the ceiling for purchasing foreign currency by exchange shops and banks in the regulated market to $500,000 a day.
The regulated market refers to a network of banks and certified moneychangers working under CBI supervision. Traders in this market deal in wholesale trade while retail business is said to be the function of moneychangers outside the regulated market.
The CBI said Monday it will inject $50 million in hard currency in the forex market every day to stabilize rates. The interventions, however, so far had little or no positive effect on the chaotic currency markets spread across the country.
Following the announcement, forex rates dipped temporarily in the early hours of trade on Monday with the dollar declining by 8,000 rials to 306,000 rials. It resumed the rally during the session and advanced to 316,000 rials, closing the session 1.26% higher.
Authorized exchange shops, assigned by the central bank to regulate currency market, pulled down the dollar rate by 2.46% to 304,000 rials, according to Tehran Gold and Jewelry Union website.
As is the norm, currency rally extended to the gold market pushing the Emami gold coin up 1% to reach 163,000 million rials.
Forex rate volatility has intensified in recent weeks especially after the US announced fresh sanctions on Thursday against Iran’s financial sector.
In its latest hostile policy, Donald Trump’s Treasury Department imposed sanctions on 18 Iranian banks aiming to totally cut off the country from the world's financial system and undermine the government’s shrinking revenues.
