Business And Markets

Central Bank of Iran Defends Currency Control Policy

Hemmati Defends Currency Control Policy
Hemmati Defends Currency Control Policy

Governor of the Central Bank of Iran says the bank has had at its disposal few policy options to address problems that have plagued the economy for years and came to the surface after the US imposed new sanctions in late 2018.  
Abdolnasser Hemmati, who was addressing the annual CBI general assembly on Thursday, pointed to measures for controlling the currency market as the most viable solution the government had in the summer of 2019 -- a time of heightened stagflation. 
“At the outset of the rising currency rates and the subsequent inflation last year [fiscal 2018-19], which coincided with the economy entering recession, the central bank had no alternative but to control the currency market,” the CBI website quoted him as saying.
He reckoned the weaknesses of the contractionary policies proposed by some economists as an alternative at the time, noting that the contractionary policy would involve significant rise in interest rates and steep decline in the base money. 


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