Men take pictures of an exchange shop screen with currency rates, Tehran, October 2, 2018 (Vahid Salemi/AP)
The head of Iran’s Central Bank is proclaiming that all is well with the country’s currency, despite a 67% drop in value in the past year.
Abdolnaser Hemmati declared the Government is successfully managing the economic situation, even though the Central Bank is “at the forefront of an economic war”:
Thanks to God Almighty and all state officials and heads of the three branches of power for their help, the central bank has preserved the value of the national currency as much as it can and now, despite the continuation of pressures, it has the necessary control over the currency market.
The Iranian rial sank from an already-historic low of 45,000:1 v. the US dollar in January 2018 to 190,000:1 by the summer. Government intervention, including Hemmati’s replacement of Valiollah Seif as Central Bank governor, checked the slide.
The rial recovered to 109,000:1 by the end of 2018, but has gradually weakened again, standing at 135,000:1 on Wednesday.
Amid the devaluation, US sanctions, and other economic problems, inflation has resurged to more than 40%. The Rouhani Government, which inherited a similar rate in 2013, had brought the level down to single digits.
The Governor’s assessment is more optimistic than that of President Hassan Rouhani. He said on Monday that while the government has halted the rial’s fall, it has yet to return balance to the foreign currency market.