After allowing non-oil exporters to sell their foreign currency at “negotiated rates” earlier in the week, the Central Bank of Iran extended the move to other forex sellers.
In a bylaw to official exchange bureaus on Thursday, the regulator let retail and institutional currency holders to offer currency at negotiated rates.
According to the bylaw published by IRNA, authorized moneychangers must “uphold money laundering rules when purchasing currency in banknotes.” How this can and should be done was not clear.
In line with moves to control volatility in the currency market, the central bank is struggling to boost supply the demand for which never ceases.
Earlier in the week, the CBI allowed moneychangers to purchase overseas currency income from exporters at “agreed prices”.
The move was welcomed by exporters because they can sell their banknote currency at higher rates than Nima platform, where rates are usually lower than the open market rates.
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 import companies buy currency for importing goods, machinery, equipment and raw materials. In this system, importers declare their currency needs, exporters register their currency proceeds and banks and authorized moneychangers are brokers.
Behzad Lame’i, head of the CBI Export Department, said the policy was successful. “It delivered within four days and the average dollar rate against the rial dropped to 310,000,” he said, referring to prices quoted in Tehran’s unofficial market. The greenback soared to the historic high of 333,000 rials last Sunday.
Referring to an earlier CBI bylaw, he said all real and legal entities can bring “unlimited amounts of foreign currency” into the country after customs declaration.
The High Council of Economic Coordination, ad hoc decision-making body comprising heads of the three branches of power, recently gave the CBI more power to restore calm to the chaotic forex market in which prices have forever been of the ascending order.
According to Kamran Soltanizadeh, head of the Association of Bureaux de Change Operators, authorized exchange shops operating in the regulated market buy dollar banknotes at around 300,000-303,000 rials from those willing to sell.
“The greenback is sold at 270,000-274,000 rials to outbound travellers,” he was quoted as saying by IRNA.
The regulated market is a network of certified exchange shops and banks dealing in wholesale currency under CBI auspices. One dollar is currently worth 273,100 rials in this market.
Currency, Gold Stable
The currency market was relatively stable on Thursday as the CBI said the new currency policy is here to stay until the market stabilizes.
The regulated market announced that its exchange shops would be open and operational on Friday, which is the weekly holiday in Iran to offer currency service to buyers.
The greenback was worth 319,000 rials in Tehran’s free market, up slightly from 318,500 rials quoted a session before. The euro was traded 1,500 rials lower at 334,500 rials. The UAE dirham was almost unchanged on the session before buying 86,850 rials on Thursday while the GBP saw 1% gain at 399,700 rials.
The domestic bullion market saw more losses thanks to the downturn in the currency market and the decline in global markets.
The popular Emami gold coin changed hands at 151 million rials, down 1 million rials or 0.67% from the previous session.
Half-Bahar Azadi coin dropped 1.1% or 1 million rials to 86.5 million rials and one gram of 18-karat gold was worth 14.14 million rials, down from 14.26 million rials on Wednesday.
Gold fell Friday in international markets and was on pace to post more than 1% fall for the week, dented by a stronger dollar and hawkish policy signals from major central banks even as recessionary fears loom, Reuters reported.
Spot gold was down 0.6% to $1,845.99 per ounce and US gold futures fell 0.1% to $1,848.00.
