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Liquidity Trend Bodes Ill for Bank Lending

Liquidity Trend Bodes Ill for Bank Lending Liquidity Trend Bodes Ill for Bank Lending

A look at the balance sheets of Iranian banks and credit institutions shows that their capacity to create money and allocate credit has been significantly influenced by the current state of liquidity and is expected to drop.
The total volume of liquidity was reported by the Central Bank of Iran at about 16.02 quadrillion rials ($136.35 billion) by the end of the fourth month of the current fiscal year on July 22. 
However, an analysis by Tehran Chamber of Commerce, Industries, Mines and Agriculture published on its website shows that about 95% of the money supply are in the form of deposits that had either been allocated to manufacturing or non-manufacturing sectors as loans or entrusted to CBI in the form of reserve requirement and surplus reserves. 

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