Iran to keep interest rate at 12%

Iran Focus: Tehran, Iran, May 01 – The Iranian government’s economic committee, tasked with drawing up monetary policy for the nation, has called for bank interest rates to be kept at 12%, state media reported on Thursday.

Iran Focus

Tehran, Iran, May 01 – The Iranian government’s economic committee, tasked with drawing up monetary policy for the nation, has called for bank interest rates to be kept at 12%, state media reported on Thursday.
 
The rate which has been approved by the committee still requires approval from hard-line President Mahmoud Ahmadinejad, the state-run news agency Fars said.

"An additional reduction in a decree by the president has not been ruled out", the state-run daily Donya-ye Eqtesad said.

The central bank had proposed setting interest rates at 3 percent above inflation, which is currently running at more than 20 percent. Economists say low interest rates, combined with government spending largesse, have fuelled price rises.

Some economic analysts believe that Ahmadinejad who has ruled over a disastrous period in Iran’s economy may see a cut in the rate as an opportunity to stave off rising dissatisfaction among Iran’s population which has led to widespread anti-government demonstrations in recent months.

Some information provided by Reuters