Economy, Business And Markets

CBI Outlines Monetary Polices

CBI Outlines Monetary PolicesCBI Outlines Monetary Polices

The Central Bank of Iran has recently unveiled a report outlining the economic achievements of the previous fiscal year, forecasts for the current year, and challenges facing the monetary policymaker.

According to the report, the average US dollar exchange rate in the year that ended March 20 grew only 3 percent compared with one year earlier. CBI officials argue that paves the way for implementing a unified exchange rate in the coming months.

The statistics also indicate that commercial banks have gone beyond the target lending of 2.8 quadrillion rials during the period, providing 3.4 quadrillion rials in loan to the economic sectors. The figure registered 44.5 percent growth year-on-year. Out of the total lending, 60.7 percent were allocated to provide cash flow for the enterprises.

The administration has also managed to curb inflation from 40.4 percent in October 2013 to 15.6 percent in 2015. The money supply’s growth rate was also reduced last year to 22.3 percent from about 30 percent in the year before.

By the end of the last Iranian year, money base growth rate stood at 14 percent, of which 3.4 percent is attributed to the expansion of CBI coverage to new banks.

According to the report, the regulator is seeking to reduce inflation rate further to 13-14 percent by yearend (March 2016).

The officials expect that their forecast for economic growth would change depending on the results of the ongoing nuclear talks between Iran and the world powers. However, the CBI reiterated that the impact of a lifting of sanctions on macroeconomic indicators will not be visible until early 2016.

The CBI expects the economy to grow 2.5-3 percent in the current fiscal year, according to the report.