Latest Reports from the Turbulent Currency Market; 'Dollar Surpasses Six Thousand Tomans'

News agencies and currency exchange offices in Iran reported on Tuesday afternoon, April 8, an increase in the price of the US dollar, surpassing the six thousand toman mark. This has raised concerns about the influx of counterfeit dollars into the market and further unrest. However, some domestic news sources acknowledge that the announced prices are merely displayed on exchange boards, and no actual buying or selling is taking place, with no dollars available for transactions. According to ISNA news agency, some currency traders announced the selling price of each US dollar at six thousand one hundred tomans, marking a new record for this currency. Websites 'Fi-Bazar' and 'Mesghal', which publish news related to foreign currencies and coins, have also confirmed this figure. Meanwhile, Mohammad Baqer Nobakht, Iran's Vice President and Head of the Planning and Budget Organization, described the currency market conditions as 'unacceptable' in an interview with IRIB news agency, while also acknowledging that 'criticisms of the government's performance' are 'valid.' Nobakht stated that restoring balance to the currency market requires 'broader policies than the Central Bank's operational scope' and announced that President Hassan Rouhani has assigned a special mission to his First Vice President, Eshaq Jahangiri, to devise solutions for the currency market, with multiple meetings already held in this regard. According to the government spokesman, the current currency market conditions are 'against the government's wishes.' The Head of the Planning and Budget Organization emphasized that without detailing the government's and Central Bank's plans and policies to control prices in the currency market, he insisted that with 'the finalization of the government's desired policies and the use of all system capacities,' the currency market will 'certainly stabilize in the coming days.' However, according to ILNA news agency, currency exchange offices in Istanbul Crossroads and Ferdowsi Street recorded the buying price of each US dollar at five thousand seven hundred tomans and the selling price at six thousand tomans before noon on Tuesday, April 8, with the dollar's rising trend remaining steady in the afternoon hours. According to this news agency, exchange offices located on Pasdaran Street in Tehran even announced the selling price of the dollar at six thousand one hundred tomans. However, ILNA's report emphasized that traders are unwilling to buy and sell dollars, and transactions in this market are locked. An examination of currency exchange websites also indicates that some have not updated the new currency prices and still display the same prices from previous days. The selling price of each US dollar on some economic media websites, such as 'Eghtesad News', recorded the dollar in a fluctuating range of five thousand eight hundred tomans, reaching up to five thousand eight hundred fifty tomans by midday Tuesday. The average selling price of the US dollar in the currency monitoring system, 'Sena', which is based on transactions registered in the currency monitoring system by authorized exchange offices across the country, recorded the average price of each US dollar at over five thousand twenty tomans by midday Tuesday, adjusting the average dollar price to four thousand nine hundred eighty tomans by the end of the working day on Tuesday. In the late hours of Tuesday's working day, the news about the supply of currency by petrochemical companies to the market managed to halt the rising trend of the dollar price and even led to a correction. Given that the presence of these market makers in the currency market occurred late, one cannot definitively comment on their impact on the market, but the announcement of the presence of petrochemical companies in the currency market and the supply of export currencies from this sector can be seen as a sign of the direction of government and Central Bank policies in the currency market. It remains to be seen how price developments in the currency market will unfold in the coming days to clarify the success of these programs and policies. According to the newspaper 'Donya-e-Eqtesad', the currency market in Tehran has been a security market since Sunday, with fewer participants willing to even exchange dollar and euro banknotes. Based on reports from domestic news agencies, the atmosphere of the currency market in Ferdowsi, Monoucheri, and Istanbul Crossroads on Tuesday was also characterized by a security and police presence. The newspaper 'Donya-e-Eqtesad' reported that exchange offices on Sunday were also reluctant to engage in transactions, and the announced prices, which shifted resistance price thresholds one after another, were mostly paper prices on which no transactions occurred. Meanwhile, long queues of dollar banknote buyers in front of official bank exchange offices indicated the low price of dollars offered by these exchanges. According to ILNA news agency, the National Bank of Iran's exchange office offered each US dollar at even less than five thousand tomans at a rate of four thousand nine hundred sixty-nine tomans by midday Tuesday, and long queues formed in front of bank-affiliated exchanges on Sunday, to the extent that some buyers and dollar applicants could not complete their purchases. Although the prices of various coins were also increasing due to the rising dollar price, buying and selling coins were conducted without restrictions, and the coin and gold market was not locked like the dollar and euro markets. According to reports, the price of the full Bahar Azadi coin reached one million eight hundred eighty thousand tomans on Tuesday, and each full Bahar Azadi coin was sold for up to one million nine hundred fifty thousand tomans. In recent weeks, various speculations have been made regarding the reasons for the rising prices of various currencies in Iran, especially the increase in the price of the dollar. The most important factors mentioned as causes for the increase in the dollar price include the psychological market atmosphere resulting from heightened tensions between Iran and the US and the possibility of the US exiting the JCPOA. Additionally, the pressure of the dollar to reach its actual value against the rial and the government's and Central Bank's inability to cope with this trend are also cited. Another factor mentioned as a cause of instability in the currency market is the government's tendency to sell dollars at higher prices to attract more rials, which the government has denied. The Central Bank's pressure on banks to reduce short-term deposit interest rates and the outflow of these deposits from banks towards the currency market are also considered effective factors in increasing prices in the currency market. Mohammad Reza Pourabedini, head of the Economic Commission of the Parliament, stated that the increase in the currency rate 'has no economic basis' and that 'political tensions, the stock market, and speculation can influence this market.' However, Hesamodin Ashna, media advisor to Hassan Rouhani, indirectly pointed to hidden hands as factors behind these fluctuations in the currency market in two tweets. In one of his tweets published on Sunday, he emphasized that 'the problem is not just Istanbul Crossroads; part of the problem is the crossroads leading to Istanbul, Erbil, Dubai, and ...'. He wrote that 'the people and the government did not succumb to social crisis-making in December, nor will they succumb to economic, communicative, and informational crisis-making in May.' Some other political activists, such as Mostafa Tajzadeh, an reformist political activist, highlighted the role of the 'hidden government' and 'shadow government' in creating this price tension in the currency market, attributing the responsibility for this situation to the Islamic Revolutionary Guard Corps and other security and intelligence institutions critical of and opposed to Hassan Rouhani's government. However, Hesamodin Ashna, in another tweet, shifted the blame for the instability in the currency market towards Saudi Arabia, implicitly threatening, 'The capital that seeks to launch a proxy and multi-layered war against Tehran must be careful, as the patience of the children of Persian Salman has its limits.' The sudden increase and record-setting price of the dollar in recent days has also resonated among social media users, with many users on Twitter sharing their observations and opinions under the hashtag #Fall_of_Rial. It is expected that Masoud Karbasian, the Minister of Economy, and Valiollah Seif, the Governor of the Central Bank, will appear before the Economic Commission of the Parliament on Tuesday to provide explanations to the council's members regarding the developments in the currency market.