Central Bank of Iran Assures Long-Term Forex Stability

The Central Bank of Iran distinguishes between temporary fluctuations and long-term trends in the foreign exchange market and closely considers this in its decision-making to ensure forex stability in the long run, the policymaking body's governor said.

"The CBI approach in devising foreign exchange policies has been to maintain the stability of market supply and demand, and prevent currency shocks," Valiollah Seif also wrote in his channel on the social-media platform Telegram on Wednesday.

He was referring to new heights recorded by the greenback in Iran's foreign exchange market where its exchange rate crossed the 40,000-rial psychological threshold, with some accusing the government of allowing the rial's slide to compensate its spending deficits.

The rial was quoted at 40,160 rials to the dollar on Wednesday, according to the Tehran Gold and Jewelry Union website.

According to the CBI chief, the surge in foreign exchange rates is tied to several economic factors, international developments and seasonal events such as the pilgrimage of Iranians to Karbala in Iraq for commemorating Arbaeen, the 40th-day anniversary marking the martyrdom of Imam Hussein (PBUH) and his companions in 7th century AD.

"Just like the previous year, the central bank will work to keep the exchange rates from increasing too much and prevent sudden volatility," Seif promised.