After two successive declines since the beginning of the business week on Saturday, forex rates jumped again on Monday driving up gold prices.
The US dollar was traded at 259,000 rials in Tehran’s open market, up 4,000 rials or 1.6% over the session before. It hovered slightly above the critical 260,000 rials on Saturday, losing 2.4% in two days before paring much of the losses on Monday.
Currency prices retreated in the beginning of the week following positive reports about talks to revive Iran’s 2015 nuclear deal.
Based on similar optimism, the greenback has lost about 15% against the rial in two and a half months since the beginning of the complex nuclear talks in Vienna in mid-December.
Success of the negotiations, experts say, should, among other things, translate into a stronger rial, which has lost much of its value after the US reintroduced economic sanctions in 2018. Banking and financial sanctions are to be lifted and billions in Iran’s blocked forex assets will be released if and when the new nuclear agreement is signed.
Surge in currency prices on Monday apparently signifies a shift in investors’ approach as they become pessimistic about reaching the much-awaited deal in the near future.
Citing currency market analysts, the Persian-language economic website Eqtesad News said investors would likely increase buying currency.
The euro gained 0.7% Monday to close at 281,000 rials, the UK pound sterling was up more than 0.8% to buy 339,800 rials and the UAE dirham climbed 1.6% and was quoted at 70,600 rials.
In the regulated market, where currency is traded wholesale, the greenback was tagged at 244,350 rials – up 0.6% on Sunday. This market is a CBI-affiliated spot market operated by a network of banks and certified moneychangers dealing in wholesale currency.
Currency prices in the exchange bureaus affiliated to the CBI dropped on Monday. Melli Exchange quoted the euro at 269,880 rials, down 2.3% on the day before.
Likewise, the dollar was sold for 244,460 rials at authorized exchange shops, down 0.13% on the day.
Prices in the domestic bullion market rose Monday in tandem with currency rates and the upbeat mode in international markets.
The popular Emami gold coin crossed the critical 120 million rials level to settle at 121.3 million rials gaining 1.8% or 2.2 million rials.
Half Bahar Azadi coin rose 1.6% or 1.1 million rials to reach 68.8 million rials and one gram of 18-karat gold was sold for 12.08 million rials -- 1.1% higher on Sunday.
In international markets spot gold gained 1% reaching $1,988.46 per ounce on Monday after scaling its highest since Aug. 19, 2020 at $2,002.31 earlier in the session.
