28652
Buzz Over Interest Rate  Cut Fades Away
Economy, Business And Markets

Buzz Over Interest Rate Cut Fades Away

In its latest meeting on Tuesday, the Money and Credit Council disregarded mounting pressure for further interest rate cuts from government officials.
In less than six months since the interest rate ceiling was lowered by the council, rising criticism of the existing rates prompted the Economy Minister Ali Tayyebnia, about three weeks ago, to look into the issue at the next meeting of the council.
The announcement was later echoed by the head of Planning and Management Organization, Mohammad Bagher Nobakht, although it did not trigger any response from the central bank officials, ISNA reports.
Meanwhile, the economic incentive package unveiled by the government last weekend was silent on further rate cuts, which usually are blamed as the main obstacle to higher production and productivity. The policy package, designed to curb recession and increase consumer demand, only called for inter-bank interest rate cuts.
Debate over further reduction in interest rates coincided with remarks by the governor of the Central Bank of Iran Governor, Valiollah Seif, who again singled out the high interest rates on uncertified lending institutions, liquidity shortage facing banks and lenders and the mounting non-performing loans. He dismissed the efficacy of rates by decree and said the economic ground realities should determine the deposit/lending rates.
Nevertheless, the latest statements by the CBI chief indicate that the regulator prefers to wait until the requirements for further cuts in interest rates, namely better financial position of lenders and more regulated financial institutions, are in place. It is, however, likely that the cuts could be announced before the Iranian fiscal year is out in mid-March.

 

Short URL : https://goo.gl/DrXgKK
  1. https://goo.gl/Y2vaQA
  • https://goo.gl/4JRS7L
  • https://goo.gl/DRqxSp
  • https://goo.gl/iYNIci
  • https://goo.gl/HOUBt8

You can also read ...

Forex Rates Tumble
The Central Bank of Iran’s measures, namely to issue...
Iran to Send More Flour to Iraq via Russia Wheat Deal
Iran is negotiating a wheat import deal with Russia that would...
Iran’s currency had lost a quarter of its value in six months, sliding to a record low of 49,000 last week.
Governor of the Central Bank of Iran Valiollah Seif defended...
Gov’t Earned 150% More From Tax Than Oil Last Fiscal
The government earned 150% more from tax than from oil in the...
24 New Foreign Traders in Iran’s Capital Market
The Central Securities Depository of Iran issued 24 trading...
$32 Billion Worth of Transactions in 1 Month
Shaparak, the payment settlement network and watchdog...
Lawmakers expressed concerns that the government is becoming increasingly dependent on raising money by issuing debt to cover widening budget deficits.
The government has issued over 300 trillion rials ($6.4...
NDFI to Get 32% of Oil, Gas Money
Members of parliament on Saturday approved a measure...

Trending

Googleplus