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Impact of FATF’s decision & November sanctions on Iran’s foreign exchange market

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Baku, Azerbaijan, Oct. 8

Trend:

The decision of the Financial Action Task Force (on Money Laundering) (FATF) cannot influence Iran’s foreign exchange market in a short time, Head of Iran’s Society of Currency Exchange Workers Reza Torkashvand said, ISNA reported.

He was speaking at a press briefing on the situation in Iran’s foreign exchange market.

November sanctions also influence the market, but there will be no substantial effects, he added.

“On Oct. 7, the FATF projects were investigated in the Iranian parliament and will be examined at the next session by the Guardian Council,” he said. “The market reacted positively to this decision, and the cost of $1, which was more than 13,000 Iranian tomans, decreased to 11,800 tomans. However, later, prices in the market rose again to 13,000 tomans.”

Torkashvand noted that the decrease in the currency price is partly related to the fact that the psychological situation in the Iranian market gave a different result.

“That’s because usually external pressure results in aggravation of psychological condition,” he said. “However, the approval of such projects by the FATF may lead to the decline in foreign currency prices. Generally, this decision has no serious effect on the market. That’s because it can’t help to bring banknotes to the country or facilitate their transfer through bank in a short time.”

Torkashvand also answered the question why some of the currency exchange points refused to buy and sell currency given the Central Bank’s permission.

Previously, the Central Bank of Iran played a key role in maintaining stability in the market and satisfied almost all the needs of the market, he said.

But now, currency exchange points sell the currency they buy, he noted.

Therefore, it is natural if a currency exchange point doesn’t buy and sell currency or if there are no currency reserves for sale, he added.

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