The forex market in Tehran was volatile on Wednesday as most foreign currencies posted gains reportedly spurred by expectations arising mainly from political developments.
The dollar vacillated between 269,000-272,000 rials for 10 days before rising sharply to 275,300 rials on Wednesday in Tehran’s open market, up 1.5% or 4,100 rials compared with a session earlier.
Likewise, the euro gained 0.75% or 2,450 rials to fetch 325,390 rials and the UK pound sterling was quoted at 378,920 rials, up 0.9% or 3,430 rials. The UAE dirham was worth 75,130 rials, rising 1.2% or 930 rials compared to Tuesday.
Citing market analysts, the Persian economic website Eqtesad News said currency traders reportedly are reacting to negative reports by the Wall Street Journal on Tuesday about the fate of Iran’s nuclear deal.
Referring to confidential reports by the International Atomic Energy Agency, the US newspaper claimed Iran was “refusing to allow inspectors access to nuclear-related sites and hindering a probe by the United Nations atomic agency, casting doubt on efforts to revive the 2015 nuclear deal.”
The news pushed the dollar for forward deals to above 275,000 rials, according to Eqtesad News.
The United States pulled out of the historic multilateral accord in 2018 and imposed tough economic sanctions on Iran to which Tehran responded by scaling down its commitments provided by the deal.
Iran’s currency market has been highly sensitive to updates about the fate of the nuclear agreement. If efforts to restore the accord bear fruit, the rial, which has lost much of its value over the past year, may rebound and banking and financial sanctions would be lifted as envisioned in the original deal.
However, the opposite will happen with hopes about reviving the deal receding, as has been the case for months.
Prices at official exchange bureaus affiliated to the Central Bank of Iran failed to keep pace with open market trends and lagged behind. Bank-based moneychangers quoted the greenback at 262,690, up barely 0.25% or 610 rials on a daily basis.
The American currency gained 0.83% or 2,230 rials in the regulated currency market to buy 265,820 rials. The regulated market is a network of banks and certified moneychangers working under CBI supervision dealing in wholesale forex trade.
As currency prices rose, gold too posted gains on Wednesday. The popular Emami gold coin was worth 121,750 rials, climbing 600,000 rials or 0.5% for the day.
Half Bahar Azadi coin remained unchanged and was worth 61.5 million rials and one gram of 18-karat gold rose more than 1% to buy 11.8 million rials, the Tehran Gold and Jewelry Union said.
In international markets the yellow metal held below the key psychological level of $1,800 on Wednesday, as a buoyant dollar made bullion more expensive for holders of other currencies, while investors await clues from major central banks on their stimulus tapering measures, Reuters reported.
Spot gold was flat at $1,795.22 per ounce, hovering close to an over one-week low of $1,791.90 on Tuesday while US gold futures fell 0.1% to $1,796.90.
