Economy, Business And Markets

SEO Mulls Over Launch of Forex Market

SEO Mulls Over Launch of Forex Market SEO Mulls Over Launch of Forex Market

Iran is weighing the prospects of launching a foreign exchange market for the first time to enable participants to buy, sell, exchange and speculate on currencies.

“Officials are trying to open an independent exchange market, in a similar move to the Azadi gold coin futures contracts in Iran Mercantile Exchange,” said Mohammad Fetanat, chairman of Iranian market regulator Security and Exchange Organization.

The forex trading market usually features banks, commercial companies, the central bank, investment management firms, hedge funds, retail forex brokers and individual investors.  

In the new market, the Central Bank of Iran, commercial banks and licensed bureau de charge would play a key role, according to Fetanat.

“Without CBI’s cooperation, the new market cannot succeed,” he told IRNA, adding that he already discussed the issue with the minister of economy and expressed hope that he could help the SEO open the forex market.

Trading in foreign exchange markets throughout the world frequently exceeds $5 trillion per day.

Citing the SEO chief, IRNA said Azadi coin’s price will be calculated in the new market using global ounce price multiplied by the dollar’s price against the rial.

Among major issues that need to be addressed before a forex market opens is the current multiple foreign exchange rate system, he said.

Fetanat hoped that in a matter of months after the nuclear deal is signed between Iran and the six world powers, the exchange rates would be unified, helping the foreign exchange market become more stable and predictable.

Iran currently has an official and an unofficial rate for foreign currencies. CBI authorities have vowed to unify the rates soon after sanctions are removed.

Iran and the P5+1—US, Britain, France, China, Russia, and Germany—are hammering out a final agreement on Tehran’s nuclear energy program. If they reach a deal by July 7—a self-imposed deadline—all financial sanctions will be terminated. The lifting of sanctions would let Iran’s financial system resume interactions with global markets.