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Banks Shun Gov’t Bonds

Banks and credit institutions again refused to buy government bonds at the weekly auction on Tuesday while retail and institutional investors in the stock market too remain averse.
Investors bought 5 trillion rials ($20 million) in bonds out of a total of 180 trillion rials ($700m) on offer. The auction will be repeated next week when the new government will try to sell debt worth 170 trillion rials ($655m), the website of the Central Bank of Iran said.
To plug its ballooning deficit holes the government started selling Islamic bonds in May via weekly auctions held by the CBI. Unlike the enthusiasm last year, the Economy Ministry has failed to attract investors to the debt market, raising inflation fears emanating from the government’s tight budget and ever-increasing spending.
Analysis by the Persian-language economic website Eqtesad News show government income from 11 bond auctions was around 80 trillion rials ($310 million) -- way lower than its initial predication to sell 1,250 trillion rials ($4.8b) by the time the current fiscal year is out in March 2022.

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