DUBAI (Reuters) – Iranian Central Bank governor Abdolnaser Hemmati said he would defend Iran’s ailing currency against speculation without injecting hard cash into the market, after the currency fell to historic lows this week.
The rial currency sank to its lowest-ever level on Tuesday before recovering slightly, days after the U.N. nuclear watchdog increased diplomatic pressure on Iran by urging Tehran to stop denying it access to two suspected former nuclear sites.
“For periods when we are experiencing short-term shocks in the economy, no committed and informed central bank would ‘spray’ its resources onto the market,” Hemmati said in an Instagram posting late on Friday.
Iranian officials say they have largely abandoned a policy of injecting large amounts of hard currency to support the rial since 2018, when it lost about 75 percent of its value after the United States withdrew from a landmark 2015 nuclear deal and re-imposed sanctions.
“The central bank will certainly deal with speculative fluctuations, and the trend of the past three days has shown that strong market management will prevent instability and turmoil,” Hemmati added, without elaborating.
The rial has gained slightly against the U.S. dollar, trading on the unofficial market at around 192,000 per dollar on Friday, after falling to a historic low of 205,000 on Tuesday, according to foreign exchange websites including Bonbast.com.
The official exchange rate is 42,000 rials per dollar and is used mostly for imports of state subsidised food and medicine.
(Reporting by Dubai newsroom; Editing by Will Dunham)