Iran Currency Market Unaffected by Presidential Election

EghtesadOnline: Governor of the Central Bank of Iran has dismissed claims that Friday's presidential election would trigger fluctuations in the foreign exchange market, reassuring the public that all is calm in the Iranian currency market.

News ID: ۷۴۱۵۸۷

20 May 2017

"In recent days, some have been trying to spread rumors in the country that after the presidential elections, foreign exchange rates would go up," Valiollah Seif also wrote in his channel in the social media app Telegram.

These people, who are merely following their own interests and political goals, "have targeted the stability and calm of the economy", the support for which has been underscored by Leader of Islamic Revolution Ayatollah Seyyed Ali Khamenei.

"While unable to witness and attest the stability of the economy in the foreign exchange market, these individuals have taken to denying the truth, which is an important achievement of the government," Financial Tribune quoted Seif as saying.

However, the CBI chief said the currency market is currently stable and reassured the public that no such instigations could destabilize it.

Five years ago when Mahmoud Ahmadinejad was in office, the Iranian rial, which was then exchanged for about 10,000 rials per dollar, went into a freefall as a result of international sanctions, lost around 70% of its value and was traded for about 35,000 rials per dollar.

During the four-year tenure of President Hassan Rouhani, the rial mostly held steady and currently 37,500 rials are traded to the dollar.

Top economic officials, including Seif, have repeatedly listed this as one of the achievements of their tenure.

While the rial has not lost its value like it did during the tenure of the previous government, the currency market has not been completely free of trouble, as the final months of 2016 brought about a period of unease. In those months, it weakened to 41,500 per US dollar–volatility that were ascribed to seasonal changes, events such as Christmas and Arbaeen pilgrimages to neighboring Iraq and Donald Trump's victory in US elections.

According to Seif, "no factor can exert an important and meaningful impact on the stable conditions of the currency market at present" and if something was to test that stability, it would have taken place in the runup to the Friday vote.

"Fortunately, like in previous years, we have witnessed the continuation of calm and stability in the economy and the currency market during these days," he added.

Seif noted that even though global oil prices experienced a significant drop in the past few years, the currency market is in a state of remarkable stability, which is considered an undeniable economic achievement of the country.