Reuters: An Iranian monetary policy body is studying the possibility of strengthening the rial against the U.S. dollar to fight double-digit inflation, according to an unsourced news agency report carried by newspapers on Monday. TEHRAN, Jan 21 (Reuters) – An Iranian monetary policy body is studying the possibility of strengthening the rial against the U.S. dollar to fight double-digit inflation, according to an unsourced news agency report carried by newspapers on Monday.
Iranian officials were not immediately available to comment on the report by the ISNA news agency, published by several newspapers, which said the idea studied was to raise the rial’s value to 7,000 against the U.S. dollar from the current central bank rate of 9,313 rials.
“This suggestion that has been brought up in the Money and Credit Council with the aim of controlling inflation … is currently being studied by experts of parliament’s research council and other expert institutions and also Iran’s chamber of commerce,” the ISNA report said.
But one newspaper, Etemad-e Melli, quoted a senior official at Iran’s chamber of commerce as saying it was unlikely the proposal would be ratified.
Etemad-e Melli said such a move may lead to the control of inflation in the short-term, but also could weaken exports and domestic industry and push up unemployment.
Iran — the world’s fourth-largest oil exporter — is struggling with steadily climbing inflation, which reached 19.1 percent in the year to Nov. 22.
