The Central Bank of Iran said it is undertaking efforts to improve forex supply in the volatile market by encouraging non-oil export companies to increase their currency sale.
Following a meeting with managers of currency exchange bureaus, the CBI Governor Ali Salehabadi issued an order to moneychangers to buy overseas currency income from non-oil exporters at “negotiated rates”.
That means exporters can now sell their forex income at higher rates than Nima, a special platform where exchange rates are usually lower than the open market. Rate differences have become much wider in recent days as forex prices have risen to historic highs.
“This [new order] is in line with exporters’ requests and efforts to regulate the currency market,” the central bank said.
Nima is an online platform affiliated to the CBI through which exporters sell their overseas currency income in the form of hawala. Through this platform companies buy currency for importing goods, machinery, equipment and raw materials.
In this system, importers declare their currency needs, exporters register their overseas proceeds and banks and authorized moneychangers are brokers.
Exporters have often censured the CBI for coercing them into selling their forex earnings at low rates at Nima and have demanded unified exchange rates.
The dollar was worth 249,359 rials in Nima on Monday – at least 20,000 rials lower than the rates in official exchange shops controlled by the CBI. The gap is much bigger compared with unofficial rates.
Salehabadi on Monday met petrochemical exporters, commending them for repatriating export income to help calm the forever chaotic currency market.
At the meeting, Ahmad Mahdavi, secretary of the Petrochemical Industry Contractors Guild Association said the industry sold $3.27 billion via Nima since the beginning of the current fiscal year in March. He said this could reach at least $15 billion by the yearend.
Forex Rates Pause
Tehran’s currency market has been in turmoil in recent days but prices were slightly lower Monday as dealers suspended trade in anticipation of measures taken by the regulator.
The CBI has pledged to boost the supply side. Last Thursday, the High Council of Economic Coordination, ad hoc decision-making body comprising heads of the three branches of power, gave the CBI more power to restore calm to the currency market.
The greenback ended trade in the unofficial market at 330,000 rials, down 3,000 rials from the historic high of 333,000 rials on Sunday.
The American currency has gained more than 9% in less than a month. Observers link the historic plunge in the rial to political pessimism and rising inflation expectations among the public after the government ended heavy forex subsidies for basic imports
The euro was down more than 1.3% or 4,700 rials to settle at 346,700 rials on Monday, the GBP closed at 408,200 rials, down 1.9% or 8,000 rials on the previous session and the UAE dirham lost 0.33% to finish trade at 90,300 rials.
However, rates continued to rise in the official currency market operated by the CBI-affiliated exchange shops. The dollar was quoted at 271,119 rials, 0.4% higher to the day.
The greenback was higher in the wholesale market, known as the regulated forex market. It gained more than 0.8% to fetch 271,095 rials, according to the Iran Currency Exchange website.
As a twin of the currency market, domestic bullion trade was under renewed volatility on Monday despite a lingering downturn in the international gold market.
The Emami gold coin lost more than 2.4% or 3.7 million rials on Monday to buy 160.1 million rials. Half-Bahar Azadi Coin lost 2.7% or 2.5 million rials to change hands at 90.5 million rials and one gram of 18-karat gold was worth 14.73 million rials, down 2.3% on Sunday.
In international markets, gold fell 1% Monday after the dollar strengthened and US Treasury yields rose as data showing surging inflation in the US fuelled bets for steeper rate hikes from the Federal Reserve, Reuters said.
Spot gold fell 0.9% to $1,853.99 per ounce, retreating from a more than one-month high of $1,877.05 touched earlier. The US gold futures shed 1% to $1,856.8.
