Dollar Price Surpasses 4000 Tomans

On the first day of winter 2016, the price of the dollar in Tehran's free currency market surpassed 4000 tomans, setting a new record in Iran's currency market. The US dollar, which had fluctuated around 3900 tomans in recent weeks, crossed the psychological barrier of 4000 tomans as autumn ended, with some currency exchange offices in Tehran demanding prices higher than 4000 tomans, reaching up to 4010 tomans. In autumn 2016, the dollar's rate in Tehran's free market increased by more than 11%, surpassing several hundred tomans price channels. The dollar was fluctuating around 3500 tomans at the beginning of the current Iranian year, and with its price reaching the 4000 tomans mark on the first day of winter, it experienced an increase of over 14%. The increase in the value of the dollar index in global markets is attributed to the US Federal Reserve's decision to raise interest rates by 0.25%, bringing the rate to 0.75%, which is seen as the main reason for the dollar's strengthening against other competing currencies. Additionally, the Federal Reserve has predicted that there will be three more rate hikes in 2017, which has further strengthened the dollar. Furthermore, the economic views of Donald Trump, the elected President of the United States, have also impacted the dollar's strength. On the other hand, Trump's strict stance on the JCPOA and the future of the nuclear agreement between Iran and global powers has led traders in Iran's free currency market to believe that the future of oil sales and the flow of foreign currency revenues into the country may face restrictions, contributing to the dollar's strengthening trend. The increase in Iran's oil sales and exports in the past year, reaching pre-sanction levels, has reassured the central bank and government regarding the supply of necessary dollars in the currency market, but concerns about the future of this trend and potential disruptions remain. Other factors influencing the dollar's strength in Iran include disruptions in the currency supply from petrochemical companies, which are among the main sources of currency supply to the market. In recent weeks, changes in the dirham exchange rate and the dollar rate in Sulaymaniyah, Iraq, Dubai, and Herat, Afghanistan, have also been significant factors in strengthening prices in Iran's currency market. Monitoring changes in the dirham exchange rate has become a key indicator for traders and speculators in the currency market. The central bank's recent entry into the market as the largest market maker and supplier of dollar banknotes has helped control market prices. Mohammad Baqer Nobakht, head of the Planning and Budget Organization and government spokesman, has repeatedly stated that the government's and central bank's policy is not to increase the price of the dollar and other currencies in the free market. The unification of the exchange rate, meaning the managed floating price of currency, is a policy that President Hassan Rouhani and the central bank governor have emphasized, with its implementation deadline set for the end of the current Iranian year. However, it remains unclear how feasible this program will be given the surge in the dollar's price and the widening gap between the free market dollar price and the official dollar rate in the banking network, which has reached about 800 tomans. The government has set the calculated price of the dollar in the next year's budget bill at 3300 tomans, an increase of 100 tomans compared to this year's budget law.