Economy, Business And Markets

CBI Sets 13% Inflation Target

CBI Sets 13% Inflation TargetCBI Sets 13% Inflation Target

A top official with the Central Bank of Iran (CBI) said on Monday that the bank is planning to lower the inflation rate to 13 percent for next Iranian year, starting March 21, 2015, MNA reported.

The Inflation rate in the month ending November 21 (Aban) reached 18.2 percent, down from about 40 percent a year ago.

“We have set an inflation target of 13 to 14 percent for the next year,” Akbar Komijani, the CBI’s deputy governor, announced.

According to the CBI’s data, the year-on-year inflation in Aban was 15.1 percent, down from 14.6 percent in the month ending October 22.

In response to the recent criticism to the banking system regarding the low number of loans granted to newly-wed young couples and troubled enterprises, the deputy governor said that the CBI’s Credit Department and commercial banks are planning to provide more interest-free marriage loans in the coming year.

On the cash flow issue, he said the banking system has relatively had better performance this year by providing finance to manufacturing units. “Nearly 60 percent of total loans granted by commercial banks so far this year has gone to the manufacturing units facing a cash flow problem,” he said. The figure was 53 percent this time last year, he noted.

Komijani further said that liquidity grew 28.7 percent in the month ending October 22, which was “a bit beyond the expected growth of 23-25 percent.”

The official attributed 3.9 percent of the liquidity growth to the inclusion of newly-established banks and financial institutions, underlining that more efforts are needed to slow down the pace of liquidity growth if inflation is to be reduced further next year.