Dollar in Tehran at 9-Month High

EghtesadOnline: Price of the US dollar reached 141,300 rials in Tehran’s open market on Sunday, the highest in the past nine months.

News ID: ۷۴۹۷۱۰

17 February 2020

The greenback started the ascending order in the past few weeks due mainly to speculation among market observers regarding the Iran dossier at the meeting in Paris of the Financial Action Task Force, the global anti-money laundering watchdog, according to Financial Tribune.

Currency prices have been rising amid rumors that the Paris-based body is expected to put Iran on its blacklist. Iran is currently on FATF's watch list and was given the last and final deadline last October to comply by FATF rules or face consequences.

FATF has linked taking Iran out of its blacklist on the ratification of four bills. In August 2018, Iran enacted amendments to its Counter-Terrorist Financing Act and in January 2019 amended its Anti-Money Laundering Act.

The amendments were among pillars of Iran’s Action Plan, followed by amendments to the AML law and accession to Palermo and CFT conventions.

Parliament sent the bills to the Expediency Council for arbitration, but the powerful council has not issued a final verdict so far.

In an Instagram post earlier this week, governor of the Central Bank of Iran, Abdolnasser Hemmati said reports about FATF's upcoming meeting are incorrect and the CBI will continue to strongly implement anti-money laundering measures.

He urged the people to exercise caution and not be misled by fake forex news.

Bank-affiliated exchange shops -- considered as the CBI arm in regulating the currency market, sold the dollar for 139,000 rials on Sunday and bought at 135,500 rials.

Euro also experienced a meager increase in price and was worth 152,100 rials, 0.4% higher than Saturday's close.

Experts blame economic factors, namely the growth in the price of the UAE dirham for the upsurge in local USD rates. The Emirati currency was traded at 38,600 on Sunday, slightly higher than Saturday's 38,300 rials.

Due to its strong trade ties to Iran, Dubai traditionally has functioned as the hub of currency transactions with Iran. Any changes in the dirham rates usually affect all other major currencies in Iran.

It is said that the dirham rate to the rial in Dubai determines the dollar rate for the next trading day in Iran.

Gold Glitters

Following in the footsteps of currency and gold prices in international markets, gold coins in the domestic market also experienced growth on Sunday. According to Tehran Gold and Jewelry Website, Emami gold coin gained 0.2%, or 110,000 rials, to reach 52.08 million rials. Bahar Azadi gold coin was sold for 51.35 million rials, registering no significant change compared to Saturday.

According to Reuters, gold prices rose to the highest level in more than a week on Friday, on track for a weekly gain, as investors bet on the safe haven metal to hedge against the economic impact of the coronavirus outbreak.

Spot gold rose 0.5% to $1,583.18 per ounce for the day, after touching $1,583.76, its highest price since Feb. 3. For the week, bullion has so far gained about 0.8%. US gold futures settled up 0.5% at $1,586.40.