Iranian Banks Urged to Help Control Liquidity

EghtesadOnline: Governor of the Central Bank of Iran Abdolnasser Hemmati late Monday met with chief executives of banks and credit institutions to evaluate the country’s monetary and banking developments and discuss the reformative role of banks in creating market stability.

News ID: ۷۸۳۹۸۸

12 September 2018

According to the official news website of the central bank, the head of the monetary regulator mostly wished to secure the cooperation of banking system to curb the rampant rise of liquidity and support private businesses.

Banks were also called upon to assist the central bank in handling the ongoing currency crisis that has seen Iran’s rial lose more than two-thirds of its value in the past six months.

The CBI chief stressed on implementing measures to curb money supply, which have been recently emphasized by a host of high-ranking figures, including the Leader Ayatollah Seyyed Ali Khamenei, Financial Tribune reported.

On Aug. 6, remarks made by the Leader were publicized in which he referred to the high volume of liquidity circulating in the banking system as “a big pain and a very dangerous thing”. He also called for liquidity to be redirected toward the production sector and called for addressing banking woes.

On Tuesday, Hemmati also pointed to the reimposition of US sanctions.

“Despite efforts by the Trump government to cut the country’s foreign currency income, we have considered various moves to nullify them and the central bank will continue to provide essential goods and raw materials, and meet the real needs of the people,” he said.

In conclusion, Hemmati said the government aims to minimize pressure on the general public “in this economic war” and hoped that current developments will lead to a reformation of the country’s consumption behavior and import trend, putting the country on the path of “expanding national production and promoting exports”.