A review of performance of forex, gold and stock markets over ten years show that the average returns were higher than the inflation rate.
According to data compiled by the Tehran Chamber of Commerce, Industries, Mines and Agriculture (TCCIM), except for one year, all three markets were of the ascending order.
The stock market apparently was at the top as the average annual growth of the benchmark of Tehran Stock Exchange, TEDPIX was 48.7% in the decade.
This was followed by the US dollar and gold coin. The greenback on average was up 35.9% annually based on free market rates while gold coins gained 35.2% and the euro climbed 33.4%.
During the period, the average growth in Consumer Price Index was 25.4% a year, indicating that markets recorded real gains even after adjusting for inflation.
Taking into account inflation, the TCCIM, however, said that the markets posted negative returns last year that ended on March 20.
Last year, the TEDPIX gained 4.6%, gold coin jumped 11.4%, the dollar rose 9.95% and euro 8.9%. These gains, however, were insignificant compared with the annual inflation rate of 40.2%.
The TCCIM said in fiscal 2018-19, the dollar and gold eked out the biggest gains. That year coincided with the imposition of new US sanctions after Donald Trump abandoned Iran’s nuclear deal.
The political shock triggered a wave of volatility in the key currency and gold markets, putting the rial under severe pressure from the tough economic sanctions and the subsequent collapse in oil export revenue.
US sanctions banned foreign companies from investing in Iran, sent the country’s oil production crashing to its lowest level in more than three decades and led to the unprecedented shortage foreign currency.
The report said the stock market’s heydays were ion the year ending March 2020. The TEDPIX climbed from around 180,000 points in the beginning of that year to over 500,000 points at the yearend, gaining more than 200%.
The stock market rally continued in the first five months of the subsequent year only to collapse in mid-summer.
On the back of fresh liquidity, the TEDPIX crossed an all-time high of 2 million points on August 9, 2020 – an unprecedented 300% growth since the beginning of the fiscal year, when the benchmark was near 500,000 points.
The TSE main index collapsed and plunged to as low as 1,211,935 that year, down 41% from the historic level.
