Market News

– After the recent jumps of FX rates for the second time again, Iran Central Bank is to utilize Open Market Operation in order to maintain the falling value of Iranian Rial against foreign currencies. News has that CBI is going to allow authorized banks and exchange houses to inject FX into the market and maintain the current chaotic situation. The required resources to do as such will be supplied from the CBI currency reserves along with the export revenues of non-oil producers. 

– In an attempt to dampen the unleashed inflation rate of the Iranian economy, the CBI is about to take on contractionary monetary policies after all. The new chair of the central bank, Naser Hemmati, announced that Iranian banks shall reduce and finally settle their remaining balances due to overdrafts otherwise they will be penalized.

– Central securities depository of Iran (CSDI) announced that only in the first half of 1397 (2018/19) more than 540K admission requests for trading license and code have been submitted in their systems. After the fluctuations of FX rates along with chaotic price situation of gold coins, analysts had predicted that the massive flow of money supply would reach to the capital market. As of today, there is more than 10 mn trading code registered in Tehran Stock Exchange.

In the Market

Stocks continued their supposedly never-ending super bullish trend today and some of them even broke all their previous historic caps. TEDPIX (+4.11%) jumped for 7,697.89 green points again and closed at 195,104.04 just a session shy from 200K level (previously predicted ceiling by analysts at the year-end!). IFEX (+3.61%) hiked even further and stood at 2,228.60 with more than 77.0 points advancement.

Some experts believe that the market is reaching its honeymoon end, however, others trust in continuation of this trend considering the fresh funds injecting in the market veins every day. Agah Group’s Money supply monitoring systems show that the pace of cash injection into the market got a bit slower, however, still a huge pile of cash is entering the market on a daily basis. The below image is for the last 2 weeks (trading).

Today’s tenders on Iran Mercantil Exchange carried out with a USD/IRR rate of around 97,000 level which is a sign showing diversion of all three FX rates closer to NIMA rates. It is widely believed that the out of question rates of foreign currencies in the so-called “third market” will plummet lower anytime soon and the new monetary policies of CBI fuel the fall even more.

Source:

2018, Iran Central Bank performs Open Market Operation!, Sunday, Sep 30, p.1,<https://agahgroup.com>