How Iran Is Using Currency Reforms to Withstand Trump: QuickTake - Bloomberg:
U.S. sanctions are battering Iran’s economy. They have all but stopped Western companies from investing in the Islamic Republic, sent oil production crashing to its lowest level in more than three decades and led to a dire scarcity of foreign exchange. Inflation has accelerated to more than 50%, and some foods and medicines are running short. So far, Tehran is hunkering down rather than buckling to U.S. pressure to change its foreign policy, retreat from the region and renegotiate the 2015 nuclear accord abandoned by President Donald Trump. Iran’s latest attempt to ease the pain has been a reform of its currency system.
1. Why is Iran making changes to its currency?
The rial has come under severe pressure from tightening sanctions and the subsequent collapse in oil revenue. Iran has long kept a tight grip on its currency and has been reluctant to let it devalue, maintaining the official exchange rate at 42,000 per U.S. dollar since mid-2018. As supplies of foreign exchange in the banking system dried up, Iranians increasingly turned to the unregulated black market to pay for everything from imported cars to overseas college fees. From the start of 2019 to early May, the rial plumm
No comments:
Post a Comment