The Iranian riyal continues to fall against the dollar

The Iranian riyal continues to fall against the dollar

As the Iranians are eager to buy hard currency ...

08/05/2018 - 15:57



The Iranian dinar exchange rate against the US dollar hit a sharp drop on Tuesday as Iranians took to buying hard currency, fearing the economic turmoil the country could face if US President Donald Trump withdrew from the nuclear deal.

The dollar was sold at 65,000 riyals, according to currency tracking specialist bonbast.com, down from 57,500 at the end of last month and 42,890 at the end of last year.

Reuters quoted economic experts as saying the Iranian riyal has seen a sharp drop due to rising demand for the dollar, especially as concerns over Trump's withdrawal from the nuclear deal with Tehran have increased, prompting countries in Europe and Asia to move away from trade ties with Iran.

This could reduce Iran's foreign trade, pushing inflation higher and harder to access hard currency in an economy that is mainly suffering from high unemployment and threatened by a crisis among financially troubled banks.

According to Iranian economist Mehrdad al-Emadi, the approach set by Trump's decision encourages a "collective escape" from the riyal, indicating the riyal reached a record high of 67,800 on Sunday.

"If the Iranian government does not take immediate steps to shore up the banking system and restore confidence in the business, the local currency rate may fall to 110,000," he said.

"This rate would lead to a 3-fold increase in inflation and increase barter transactions when hard currency can not be found," he said.

With pressure on the riyal in early April, the Iranian authorities tried to halt its decline by unifying official exchange rates and free markets at one level of 42,000, and banning any trade at other rates. And to threaten those who violate the prohibition of detention.

But the strategy has failed, because the demand for the dollar far exceeds the limited supplies provided by the authorities through official channels at the official rate.

http://www.basnews.com/index.php/ar/economy/435516

quick, go buy some more while it's still cheap!  LOL

Weren't Phony and the other touting the Rial as the next big thing a year or so ago?