Currency Rates Notch Higher in Tehran Market
EghtesadOnline: The US dollar gained 3% against the national currency in Tehran’s free market and was sold for 230,000 rials on Monday after vacillating between 220,000-224,000 rials for two weeks.
The greenback trade was choppy moving up and down the critical 230,000 rials but finally closed gaining 6,000 rials.
One euro was worth 274,000 rials, up almost 9,000 rials compared to Sunday’s close. The UK pound sterling jumped to 302,000 rials.
Exchange bureaus affiliated to the central bank raised prices by 5,500 rials, or 2.5%, for the day to avoid rates at bank-based moneychangers distance farther from free market rates and create arbitrage. Bank-based moneychangers sold the dollar for 224,520 rials.
Eyeing trends in parallel markets, observers refer to “rising expectations” among investors as one potential factor behind the upsurge in currency rates.
The upside is partly attributed to a relatively deep downturn in the stock market and speculations that a prolonged bear market may push investors to buy forex as a safe haven.
The USD surged significantly in late May after months of stability as rising demand and sinking supply in the secondary currency market, known as Nima, sent it as high as 260,000 rials in July. Nima is the main currency platform through which exporters sell their overseas earnings and importers buy.
This market too has had more than its share of turbulence as export becomes difficult and export companies prefer not to repatriate their earnings home as required by law.
Gold Up
Impacted by currency rates, gold prices also gained on Monday. Emami gold coin rose more than 2.5% and quoted at 2.7 million rials, and closed session at 108.3 million rials.
One Bahar Azadi gold coin was sold for 105 million rials, up 4 million rials, or 4%. One gram of 18-karat gold gained 3% to 10.7 million rials, according to the Tehran Gold and Jewelry Union.
Gold rose Monday in international markets, consolidating around the $1,950 mark after sliding 4.5% last week, buoyed by a weaker dollar as investors await the fine print on the US Federal Reserve’s strategy to stem the economic toll from the coronavirus, Reuters reported.
Spot gold rose 0.6% to $1,954.74 an ounce on Monday and US gold futures rose 0.7% to $1,963.00.
Gold last week registered its biggest decline since March as investors reassessed positions after bullion retreated from a record peak of $2,072.50 scaled on Aug. 7.