TEHRAN (Iran News) – The Central Bank of Iran (CBI) is ready to assist the government to overcome its challenges and promote economic growth through a large-scale open market operation, said the CBI governor.
In an Instagram post on Friday, Abdolnaser Hemmati, the CBI governed added an economic policy’s degree of effectiveness is directly dependent on tools that are at policymaker’s disposal, IRNA reported.
He noted that over the past 18 months, the CBI constantly designed a collection of tools, in view of its knowledge and awareness of achievements of other countries’ central banks in managing monetary and foreign currency policies, and added them to its basket after receiving approval for them through legal processes.
Through developing such tools, the CBI has sought to control the domestic economy’s fluctuations and inflation and help boost sustainable economic growth.
“Under tough circumstances, other countries’ central banks are at the frontline and by reducing interest rates and purchasing government bonds assist financial policymakers and help salvage the domestic economy. The path to achieving these two targets goes through the corridor of the interbank interest rate and conducting an open market operation.”
Hemmati also said in the previous Iranian calendar year (which ended on March 19), the two monetary tools were designed and became operational.
“Although some highlighted a lack of prerequisites, today, it has become clear that the CBI’s plan has been drawn up and implemented promptly and correctly. At present, even the critics want to use the tools.”
By issuing bonds, the Iranian government can meet its own needs on the one hand and improve the domestic bank’s balance sheet on the other, he stressed.
Hemmati added that the CBI is willing to continue its active presence in the interbank market and its management of interbank interest rates as well as the domestic market’s liquidity.
- source : Iran Daily, Irannews
