The national currency pared more past losses on Monday. The US dollar traded almost 10,000 rials lower at 305,000 rials in Tehran’s unofficial market to post more than 3% decline to the day.
The euro plunged more than 2.8% or 8,000 rials to buy 322,000 rials, the GBP was tagged at 373,500 rials, down 3% and the UAE dirham gave up 2.6% to end at 83,000 rials.
Forex rates have paused over the past few days after hitting historic highs from the beginning of June. The CBI says it has intervened in the chaotic market to restore some calm.
The regulator said it has tried to boost currency supply by encouraging export companies to sell their income at higher rates. The CBI was given more power to tackle the currency market by the High Council of Economic Coordination, an ad hoc decision-making body comprising heads of the three branches of government.
In tandem with CBI measures, reports on the resumption of talks to restore Iran’s nuclear deal has apparently perturbed currency dealers in recent days and encouraged buyers to wait and see, for now.
Any progress in the difficult and long-delayed nuclear negotiations should give oxygen to the ailing rial, which has lost much of its value over the past two years.
If the talks move forward and lead to concrete conclusions the US is expected to lift its 2018 economic blockade paving the way for the release of billions of dollars in Iranian forex assets blocked in several countries.
Despite the decline in the unofficial forex market, rates were little changed in the official market operated by the CBI-affiliated shops. The dollar was quoted at 277,120 rials by Melli Exchange – a subtle drop of 0.02%.
The greenback was traded lower in the wholesale currency market, known as the regulated market where it was quoted at 275,800 rials, according to the Iran Currency Exchange website.
After losses a session before, the domestic gold market was impacted by the currency rates on Monday despite increase in precious metal prices in international markets.
The Emami gold coin lost close to 1.9% % or 2.73 million rials to buy 144.24 million rials, the Half-Bahar Azadi coin lost 1.9% or 1.5 million rials to change hands at 80.5 million rials and one gram of 18-karat gold was worth 13.56 million rials, down 2.7% on Sunday.
In global markets the dollar weakened as economic concerns persisted, while an import ban on the metal from Russia by four of the G7 countries also supported prices to some extent, Reuters said.
Spot gold was up 0.7% at $1,838.10 per ounce and the US gold futures rose 0.5% to $1,839.
Britain, the United States, Japan and Canada will ban new imports of Russian gold to tighten the sanctions squeeze on Moscow for invading Ukraine. Russia is the world’s third largest gold producer and accounts for about 10% of the global production.
