Iran currency soars 21 percent on central bank intervention

TEHRAN,Jan.5(MNA) --Iran’s currency soared an unprecedented 21 percent in the past two days on central bank intervention to reverse a sharp slide after the U.S. enacted extra economic sanctions. On Tuesday alone, the currency, the rial, posted 14 percent over its closing value on Monday in the open market. The rial was trading at 14,000 to the dollar on Wednesday, a much stronger level than the record-low 17,800 it was fetching early Monday before the central bank intervened. Iranian Commerce Minister Mehdi Qazanfari said Tuesday the central bank had been asked “to inject more foreign currency into the market, and the central bank has promised to do so,”. He added that the government was considering “a number of measures to control the exchange market.” He did not say what they were. Foreign ministry spokesman Ramin Mehmanparast said earlier that the rial’s volatility “definitely has nothing to with sanctions.”He imputed the movements to domestic shifts in capital, for instance into the real estate sector. The head of the central bank, Mahmoud Bahmani, said the sudden fall of the rial was “due to psychological effects.” “I declare absolutely that the international sanctions have not created any economic problem for the country. The enemies know that and are trying to create psychological tensions. But we won’t play their game,” Bahmani said. He urged Iranians to refrain from buying dollars.