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Abu Dhabi, UAESaturday 20 October 2018

Iran central bank authorised to intervene in foreign exchange market to defend rial

The currency fell to repeated record lows in recent weeks following the reimposition of US sanctions

Iran’s economy only has gotten worse since President Donald Trump reimposed sanctions, with the rial going from 62,000 to one US dollar to as low as 186,000 rial to $1. AP
Iran’s economy only has gotten worse since President Donald Trump reimposed sanctions, with the rial going from 62,000 to one US dollar to as low as 186,000 rial to $1. AP

Iran on Saturday authorised the central bank to intervene in the foreign exchange market in defence of the rial, state television reported, after the currency fell to repeated record lows in recent weeks following the reimposition of US sanctions.

A top government body, headed by President Hassan Rouhani and the heads of parliament and the judiciary, "gave the central bank governor the necessary authority to intervene in the foreign exchange market and to manage it", state TV said.

"The central bank will intervene in the foreign exchange market through banks and authorised exchange shops and carry out the necessary measures to control the exchange rate of hard currencies," the television quoted the body as saying.

The Iranian rial hit a record low against the US dollar on the unofficial market on Wednesday, amid a deterioration in the economic situation in Iran and the reimposition of sanctions by the United States.

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The dollar was being offered for as much as 186,000 rials on Wednesday, according to foreign exchange websites. The rial has lost approximately 75 per cent of its value since the beginning of 2018.

On Saturday, the first trading day of the week, the rial recouped some its losses to be traded at around 173,000-178,500 per dollar, according to foreign exchange websites 2gheroon.ir and bonbast.com, which track the unofficial market.