Page 31 - IRANRptJul20

Forex and gold prices skyrocket in Iran
“The shock created in the foreign exchange market is temporary and has no fundamental economic reason and balance must return to the exchange market,” Rouhani said.
“Psychological warfare against Iran as well as the creation of an unrealistic anxiety among people, are the main causes of the recent fluctuations in the foreign exchange market,” he added.
The dollar is seen as the gold standard of hard currencies in the so-called currency free market in Iran, with the euro, pound sterling and Emirati dirham viewed as alternative currency classes.
Meanwhile, Iran’s Azadi (Freedom) gold sovereign on June 23 was at one point trading at an all-time high of IRR83mn, while the slightly heavier Emami sovereign topped IRR88mn.
Dollar, euro and sterling prices on May 13 skyrocketed on Iran’s so-called tertiary street rate or “free” market.
The sudden increases arrived with the secondary Forex Management Integrated System (NIMA) rate that is compulsory for exporters closing in on the tertiary rate, spurring bureaux de change to up their prices. Many investors are now investing in currencies as well as the booming Tehran Stock Exchange main index as the housing market remains stuck in deflationary mode. Iranian vice president Eshaq Jahangiri said on May 10 that US sanctions, the coronavirus (COVID-19) outbreak, the drop in oil prices and the woes of the global economy had caused “perilous conditions” for Iran’s economy.
The dollar reached its strongest rate against the Iranian rial (IRR) since September 2018 at IRR171,200, while the euro and pound sterling have also gained. The euro reached a several-month high of IRR185,850 while the GBP stood at IRR210,450. When the Iran nuclear deal with six major powers was signed in late 2015, the IRR was trading at 32,000 to the USD.
The gold market, meanwhile, has followed suit. The Azadi gold sovereign on May 13 hit IRR70mn while the Emami sovereign touched above IRR72.5mn.
31​ IRAN Country Report July 2020 www.intellinews.com