Economy, Business And Markets

CBI Plans Presale of Gold Coins

CBI Plans Presale of Gold Coins
CBI Plans Presale of Gold Coins

With the aim of stabilizing the gold market, boosting supply and facilitating easier access for people, the Central Bank of Iran is to start the presale of gold coins from Feb. 4, the director of the regulator's Office for Banknote Issuance announced.

"The gold coin presale will be conducted through all the branches of Bank Melli Iran," Masoud Rahimi was also quoted as saying by the official website of CBI.

According to the official, the presale will offer gold coins at prices lower than those of the market and with maturity periods of three, six, nine and 12 months.

Buyers will be able to receive their coins after the maturity period has ended, entrust the bank with their coins until they wish to use them or choose to transfer the ownership to others before or after the maturity period is complete.

However, the price of coins will vary based on their maturity periods and Rahimi said, "We will try to announce suitable and attractive prices, in view of the market's daily prices."

As of Thursday's close, each benchmark Emami gold coin was priced at 15.18 million rials ($337) while the Bahar Azadi coin was traded for 14.74 million rials ($327).

Gold coin prices have been on a rising trajectory for more than a month, prompting CBI to intervene by holding more than a dozen coin auctions through the Bank Melli of Iran's affiliate, Bank Kargoshaee.

The auctions managed to ease the coin's rally and deflate its bubble, but it seems that CBI is now pursuing a bigger intervention through the presale.

"In the initial days of the auctions, some market profiteers tried to prevent prices from coming down, but even as global gold and foreign exchange prices increased in that period, the resistance of that group broke with the continuation of auctions and the deflation of price bubble," Rahimi said.

The official noted that since CBI has sufficient gold coin and bullion reserves, there is no limitation on the volume of coins to be supplied through the presale, which means that buyers will be able to order as many coins as they wish.

Furthermore, the coin auctions were only held in the Kargoshaee Bank based in Tehran, but now people all over the country will be able to order coins in the presale.

"Therefore, the expansion in the supply of coins will lead to the elimination of speculative activities and profiteering, in turn balancing the prices," Rahimi concluded.

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