Bloomberg News

Iran’s Rial Gains 10% as Government Boosts Dollar Supply

March 05, 2013

Iran’s rial gained 10 percent against the U.S. dollar after the Persian Gulf country’s government made more foreign currency available to the market, Economy Minister Shamseddin Hosseini said.

“We expect the dollar to continue its downward trend in the market,” Hosseini told reporters today at a Tehran conference, according to a Fars news agency. It didn’t give details of the government action.

Iran’s national currency was trading at 33,200 rials per dollar today compared with about 37,000 to the greenback in street markets on Feb. 28. The increase in the rial’s value in the last six days comes after nuclear talks that both sides agreed were on the right track.

Foreign Ministry spokesman Ramin Mehmanparast said in Tehran today that Iranian officials are “optimistic” about the next rounds of negotiations with representatives of the U.S., the U.K., Russia, China, France and Germany.

“A positive atmosphere was created in the talks” in Almaty, Kazakhstan, Mehmanparast told reporters in comments aired live on state television. “If this atmosphere prevails, an acceptable outcome for both parties may be reached.”

The value of the rial, which in January 2012 was trading at 16,900 to the dollar on the street, has slumped as financial and economic sanctions against Iran were tightened to force it to curb its atomic program. European Union countries have halted oil imports from the Islamic Republic since July and U.S. measures that came into force last month are further restricting the government’s access to hard currencies.

‘Balanced, Responsive’

The offer extended to Iran in Almaty was “balanced” and “responsive” to Iranian concerns, EU foreign policy chief Catherine Ashton said last week. In exchange for Iran’s agreement to cease its output of 20 percent enriched uranium as part of its nuclear program, the group offered to ease curbs on its exports of goods including petrochemical products, the chief Russian negotiator, Deputy Foreign Minister Sergei Ryabkov, said Feb. 27.

Technical talks are scheduled in Istanbul on March 18, and political discussions with international negotiators will resume in Almaty on April 5-6. The U.S. and the EU say Iran’s nuclear program may have a military dimension, a claim the country rejects.

To contact the reporter on this story: Ladane Nasseri in Dubai at lnasseri@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net


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