Iran to keep current subsidized exchange rate in next year's budget
Iran will keep its current subsidized exchange rate for imports of basic goods in the next calendar year’s budget, according to the country’s chief banker and amid efforts to control food and medicine prices.
Governor of the Central Bank of Iran (CBI) Mohammad Reza Farzin said on Saturday that the lender will continue to allocate subsidized US dollar at a price of 285,000 rials throughout the calendar year starting March 21.
Farzin made the remarks in response to reports suggesting that the government will increase its subsidized exchange rate by at least a third in the next calendar year.
“The 30% increase in the exchange rate for imports of basic goods and medicine has been cancelled in line with efforts to support the people's livelihood,” he said.
The CBI governor said that the bank will also try to stabilize a semi-subsidized exchange rate that is used for imports of other essential goods, including machinery and equipment needed in the country’s manufacturing sector.
The current free market rate of the US dollar in Iran is 92,000 rials while the semi-subsidized rate has been hovering around 680,000 rials in the past two months.
CBI figures show the bank has allocated $12.396 billion at its subsidized rate to imports of basic goods and medicine in the 11 calendar months to mid-February.
Some $47.356 billion worth of hard currency has also been earmarked at CBI’s semi-subsidized rate to imports of commodities and goods needed in the country's manufacturing, agriculture, and pharmaceutical sectors over the same period.
Economists say the allocations are needed to help control consumer prices in Iran, a country that has seen high but controlled levels of inflation in recent years.
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