TEHRAN (Iran News) Speaking on Thursday at a meeting with business leaders in Isfahan focused on “Challenges in the Currency Market,” Central Bank Governor Mohammad-Reza Farzin said political pressures and psychological warfare have distorted exchange rates.

“The current high price of the dollar in the free market is not the real exchange rate but rather a ‘fear rate’ fueled by our adversaries,” Farzin told the gathering at the provincial Chamber of Commerce. “They spread anxiety to unsettle the public, while the genuine market rate remains far lower.”

Farzin emphasized that the so-called real exchange rate of the U.S. dollar currently averages around 920,000 rials. He said that as recently as Wednesday, in the so-called “second market” — where exporters and importers trade currency under Central Bank oversight — the dollar was exchanged at that level. Rates quoted on social media channels, often well above that figure, were described by Farzin as “unrealistic, the product of false excitement and psychological operations designed to maintain an atmosphere of uncertainty.”

He further dismissed reports about the alleged freezing of Iranian assets in European banks.

“We have no funds in the European Union, yet rumors are being circulated about seized deposits,” he said. “These claims are part of the psychological war meant to frighten our society.”

Farzin identified the sharp rise in the exchange rate in recent months as a principal driver of the country’s current inflation.

While noting that economic policymaking involves inherent uncertainties, he argued that the main source of inflation has been cost-push factors, not merely liquidity growth.

“The main reason for intensified inflation has been the jump in the exchange rate in the NIMA market — from 400,000 rials to 700,000 rials per dollar,” he said, referring to the regulated foreign exchange platform that supplies more than 70% of the country’s hard-currency needs. “This surge has raised production costs across many sectors and imposed strong inflationary pressures on the economy.”

He added that while fluctuations in the free-market exchange rate also contribute to inflation, the decisive factor remains the dollar’s rise in the NIMA, now referred to as the “second market.” Farzin pledged to bring more exporters and importers into that market to stabilize rates and reduce costs.

Farzin highlighted several measures by the 14th Iranian administration to support domestic industries, including lower-rate financing for small and medium-sized enterprises through the state-owned Bank Melli.

To assist food producers, exporters in that sector will be allowed to sell their foreign exchange earnings directly in the second market or to import gold and cash. The government is also seeking to draw in more players from the metal, steel, and petrochemical industries to increase liquidity and competitiveness in the official market.

“Exporters will be permitted to use their earnings for imports, or even transfer their export proceeds to similar firms,” Farzin said, noting that the Central Bank has introduced official dollar and euro cash trading symbols to facilitate such transactions.

He also pointed to new barter regulations for export-oriented industries, already approved by the Ministry of Industry, Mine and Trade and soon to be reviewed by the Cabinet. Farzin said these rules would help Iranian firms trade more effectively with partners in the Eurasian region, removing several existing hurdles.

The Central Bank chief further announced prioritized financing for solar energy development projects through the banking system, as well as the option to fund large-scale initiatives via bond sales.

Turning to regional issues, Farzin reported that the ratio of bank loans to deposits in Isfahan province currently stands at 74%, rising to about 85% after adjusting for mandatory reserves. He said the Central Bank is aiming to increase this ratio further and has instructed the banking network to grant greater authority to provincial branches.

At the same meeting, Isfahan’s business community voiced criticism of the country’s currency allocation policies and banking regulations. They urged swift and decisive action to resolve financial bottlenecks affecting trade and industry.

Business representatives raised concerns about difficulties in repatriating export earnings, irregularities in access to foreign currency for imports, problems with letters of credit, the misuse of one-time-use trading cards, and cumbersome regulations on barter trade.

They also called for lower bank lending rates, streamlined bureaucracy, and better support for exporters, describing export growth as the “key to economic dynamism and the country’s foreign currency needs.”

Participants suggested policy incentives — such as faster depreciation schedules for industrial machinery — to counter the decline in domestic investment.

Farzin’s trip to Isfahan, made at the invitation of the provincial governor, included multiple meetings with local officials, private-sector representatives, and the Public-Private Dialogue Council. The visit aimed to directly address banking-sector demands and improve coordination between national policymakers and regional economic actors.

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TEHRAN (Iran News) –The Shanghai bus with choosing the Islamic Republic of Iran passed the station of West’s cruel sanctions against Iran and some other members of the Shanghai Cooperation Organization (SCO).

The interesting point is that Almighty God wants the last goal of the diplomacy for membership in the SCO and Russian President Vladimir Putin’s felicitation to Iranian President Seyed Ebrahim Raisi to be scored during the 13th government, and finally after 16 years of waiting, Iran with signing the permanent membership undertakings during the Samarkand Summit was accepted as the 9th permanent member of the SCO.

On July 13, an online meeting of the SCO leaders chaired by India was held which was the 23rd meeting of the heads of this organization where the permanent membership of Iran in the SCO was officially announced. On June 30, the Secretary General of the SCO Zhang Ming in a phone conversation with Iran’s Foreign Minister Hossein Amirabdollahian had announced that the Islamic Republic of Iran, from July 4, would then have all the rights as other member countries of the organization.

This diplomatic action shows that Iran genuinely has overcome the cruel sanctions, and the diplomacy of the 13th government has opened the closed doors of the membership to the SCO. The past media memories bespeak of this fact that Iran had made great efforts for membership in the SCO in the past years. The officials of the 13th government resumed the efforts for membership as a great opportunity for the country.

After official announcement of the SCO for permanent membership of Iran and according to the tweet of the government spokesman, the bill for joining of Iran to the SCO in the government after passing all legal formalities will be passed to Majlis. Iran’s efforts for joining the SCO for years had faced hurdle because of the opposition of Tajikistan due to different security and political reasons but in the current condition and especially due to the successful diplomacy of the 13th government, the hurdle of Tajikistan was removed and permanent membership of Iran with a positive approach was presented in the SCO and with the nod of the organization for Iran’s membership, a lasting move was registered in the 13th government actions.

The SCO member states and observer state rank first in producing and consuming the most amount of energy in the world and this shows us that this organization in the field of import and export of energy can have close cooperation among its member states and at the same time to have great impact on the price and energy market in the world.

Iran as a permanent member of the SCO can take advantage of the existing advantages in exports of oil and gas to the SCO member states. In fact, the sales channel and return of money from energy exports can be considerably facilitated. Of course this status more depends on the condition that international sanctions against Iran are presumed fading out because under the massive and expanded sanctions of the West, some of big companies even in the SCO states will continue their cautions and will act with doubt in oil and gas trade with the Islamic Republic of Iran.

The self of opening the way for Iran for maximum passing from the sanctions even made the UN Chief António Guterres officially announce publicly his demands for removal of Western sanctions against Iran. This remark pines hope on better outlook for cooperation with big companies in the SCO realm.

It is worth noting that the next move of the 13th government can be formalizing the permanent membership in the World Trade Organization (WTO), that in the past some approvals have been shown regarding Iran’s membership as an observer state but the dossier of Iran’s membership in the WTO has remained without any result due to different reasons predominantly political and some infrastructural reasons. In between and regardless of the U.S. sanctions and its sabotages and obstructionism on course to Iran’s membership, the issue of noncompliance of Iran’s economic structures with the WTO rules and lack of the grounds for joining this organization has been brought forth.

In terms of economy, we should acknowledge that the membership in the SCO has been in line with reducing the West’s hegemony in the political and economic fields. The trade turnover of these 9 members of the SCO is currently around $7,000b and eliminating and ditching the dollar from their trade with this huge volume will be a devastating blow to the monetary credit and power of the U.S. dollar.

With official announcement of countries like India, China, Russia, Iran and Indonesia, the road for commuting for the next station which is the elimination of dollar is being paved day in day and therefore hopefully we can say that the next station will be the dollar elimination from trade.

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Speaking in his weekly presser, the economic spokesperson of the government added: “You are aware that since 2018 and after the resumption of US sanctions against Iran, using other currencies was on the agenda of the government so that we can reduce our reliance on the dollar. Unfortunately, the processes were moving slowly, but with the seriousness that the president and the government had to speed up the reduction of the dollar in the country’s trade, very good measures have been taken and the share of the dollar in Iran’s trade has decreased greatly.”

Khandouzi said: “Iran is mulling the use of alternative and local currencies of trading partner countries. Another point was the connection of the country’s banking network to the electronic payment network of the countries in the region, and this has happened in the case of Russia, and in the coming months, we will see that Iranian businessmen can meet their needs during their travels to Russia without using dollar-based banking systems.

Regarding the link of Iran’s banking network to the banking network of other countries, including Turkey, Oman, and Iraq, the spokesman said that the CBI was also following up.

Another measure taken is the revival of mechanisms based on barter transactions between two or three countries, which reduces the need for dollars or euros, the spokesman highlighted.

The Central Bank has also started good cooperation with the Asian Clearing Union (ACU) and the meeting of the union is scheduled to be held in Tehran in May with the presence of nine countries.

ACU is a payment arrangement between the central banks of Bangladesh, Bhutan, India, Iran, Maldives, Myanmar, Nepal, Pakistan, and Sri Lanka.

“Bilateral or multilateral monetary agreements are being pursued by CBI, especially with countries that are our main trading partners. All of these measures have caused the share of the dollar in Iran’s foreign trade to decrease by nearly a third in the last two years and reach less than ten percent, which is also not acceptable and the government is trying to seriously reduce its share,” the minister underscored.

Meanwhile the Central Bank of Iran (CBI) is seriously pursuing the policy of de-dollarization and intends to use alternative options to accelerate the global trend, says CBI Governor Mohammadreza Farzin.

“It should be noted that de-dollarization is one of the important policies which we are sensitive about,” Farzin said on Tuesday during an open session of the parliament.

According to the CBI governor, Iran will host a meeting of the Asian Clearing Union (ACU) in the near future, which will bring together all nine member states and several central bank governors from regional and Asia-Pacific countries.

He added that the meeting will accelerate the global trend of de-dollarization.

The ACU aims to facilitate settlement of payments on a multilateral basis and promote the use of participants’ currencies.

“In fact, bartering, rather than using the dollar; reaching bilateral monetary agreements, which is being finalized with several countries; and multilateral monetary agreements are the three main topics of the aforementioned international meeting that will help materialize de-dollarization,” Farzin explained.

Iran has announced its decision to move away from the US dollar and has acted on the decision in cooperation with other independent countries.

On Sunday, Iranian President Ebrahim Raisi ordered the CBI to lay the ground for conducting foreign trade transactions using Iran’s national currency rial.

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Many countries especially independent and big ones have decided to come out of the shadow of the U.S. dollar by reinforcing their currencies and cutting dependence of their economies on the dollar and it is a great blow for the U.S. dollar which has made the Americans worry about the fate of their national currency.

As many economists have predicted, China will soon replace the U.S. as the world economy No.1 and gradually its currency, yuan, is dominating in the global economy and many countries are following the footstep for replacing dollar with yuan in their trade and this is something which has angered the U.S. and it is a serious threat to the U.S. dominance in the world economy and politics.

The dollar has been an effective weapon for the U.S. in dictating its policies in the world and sanctions by the U.S. on nations is because of their dependence on the dollar otherwise sanctions would be ineffective and the U.S. will be unable to use sanctions as a tool for dominance.

In recent years many countries have decided to come out of the shadow of the dollar dominance by exchanging trade in their own currencies and this sounds warning for the grandeur of the U.S. economy and dollar, and we see the sign of decline inside the U.S. itself.

The Islamic Republic of Iran and many countries like India, Russia, Brazil and Turkey for years have decided to cut their dependence on the dollar through trade in national currencies and it will help countries like Iran and Russia to round the unfair and unilateral sanctions of the U.S. Of course in the near future the number of these countries would increase and the dollar through being ditched in trades by the countries will turn into a normal currency without any power and the Americans will be unable to impose more unilateral sanctions on other countries.

Iran’s top security official on Sunday said the move to reduce the use of dollar in regional and international transactions, joined by several countries, will minimize the West’s dominance over the global economy.

Secretary of Iran’s Supreme National Security Council (SNSC) Ali Shamkhani made the remarks in a meeting in Tehran with Russia’s State Council Secretary Igor Levitin, who is also a senior aide to Russian President Vladimir Putin.

He said the initiatives finalized between Iran and Russia in the sector of financial and banking exchanges aimed at funding joint projects are an “effective” paradigm for neutralizing the West’s unlawful sanctions against the two countries.

In recent days, Brazil has begun to accept trade settlements and investments in yuan, with an agreement reached between central banks in February, and the appointment of a yuan clearing bank and access to the Cross-border Interbank Payment System, the China equivalent to international financial messaging service Swift, last week.

Russia after the war with Ukraine decided to cut its dependence on the dollar in its trade and it decided to trade in its national currency, rouble, and it helped the country survive the unilateral sanctions imposed by the West and predominantly the U.S.

India also decided to strengthen its currency rupee and it is now using its rupee in trade with many countries like Malaysia and Iran.

So we can see countries have realized that the era of uni-polarization has come to its end and they have realized that they should stand on their own feet and cut their dependence on the dollar which is used as a tool for the economic slavery by the U.S.

The Islamic Republic of Iran has also decided to switch to other currencies in its trade with other states especially with the neighboring countries and gradually the dollar will be fully ditched and national economy will cut its dependence on the dollar which has turned into a headache for the national economy.

Of course it will take time for fully ditching the dollar but it is an action which has been taken by Iran and many countries, and soon the countries will get rid of dollar dominance on their economies and people, and it will be also an end to the U.S. economic and political grandeur and the U.S. will be no economic and political superpower any longer in the world and countries will also get rid of the unilateral and unfair sanctions of the U.S. and then a new world order will be seen with real independence.

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Speaking to reporters, Ehsan Khandouzi said that using the rial and Yuan can solve challenges facing Iran-China financial transactions and trade, adding that Iran and China enjoy strong economic ties.

The Finance Minister who is the spokesman of government economic team said the administration is seeking to minimize in-dollar trades with its partners.

Khandouzi told reporters in response to a question about dollar-free trade that it was the issue President Raisi pursued in his visit to China and Russia, which was welcomed by the two sides.

He added: “The policy of Raisi’s administration in commercial transactions with its main trading partners is to use the capacity of local currencies and minimize the need for global currencies such as the euro and the dollar.”

Until today, the majority of Iran’s trade with China as a trading partner was going on in yuan and rarely in currencies other than yuan, he noted.

The minister also said that the governor of Central Bank had negotiations with the relevant Chinese officials and its results would be reported by him.

The economic spokesman of the Iranian administration said that in the 11 months of the current Iranian year (starting from March 21, 2022), the total revenues of the administration was 1,147,000 billion tomans, which is equivalent to 9% of the figure approved by the budget law for the coming year, which if compared with the same period last year, it has been increased by 60% in revenues.

Khandouzi emphasized: “The current revenues and the tax field and other current revenues of the administration have been realized in a suitable manner, almost 100% of the approved figure of the 11-month budget.”

He further said: “In the field of expenditure in 11 months, 1154,000 billion tomans were the administration’s expenses, which increased by 52 percent in the 11 months of this year compared to last year. Almost equivalent to 90 percent of the number approved in the current year’s budget law, has been realized.”

“Meanwhile, the administration’s construction payments in 11 months have reached 104,000 billion tomans, which is an increase of eight percent over the eleven months of last year,” he said.

The economic spokesman of the administration added: “In the field of bonds, the administration’s financial performance shows that the government has repaid 126,000 billion tomans of the principal and interest of the bonds sold by the administration this year and the last one or two years, which if divided monthly, 11 and a half thousand billion tomans per month from the administration’s revenues have been used to repay the interest of bonds of the past years.”

He claimed that the condition of the forex will get better in the upcoming weeks and blamed virtual space for recent rise in devaluation of rial against dollar.

He also noted that the growth rate of liquidity has fallen to 34.1% and it bespeaks of success of the monetary policy of the country.

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Speaking in a press conference on Monday, Khatibzadeh said that the dollar has been turned into a military weapon in the international financial and monetary system against all, victimizing all geographical regions and monetary systems.

That’s why financial and monetary systems in the world have decided to decouple themselves from the dollar system, he continued.

He also said that some countries have established independent inter-bank messaging systems from the existing ones.

The spokesman said that Iran was going to host the next ministerial meeting of Afghanistan neighbors on Wednesday next week. He said foreign ministers of Afghanistan’s neighbors would join the one-day meeting in person.

The agenda would be the same as in the first meeting and foreign ministers of six countries would be focused on how to help form an all-inclusive government in Afghanistan and the future of peace and security in the country, he added.

On the talks to lift illegal U.S. sanctions against Iran, Khatibzadeh said that Iran’s definite decision was to continue talks, but it demanded the unconditional return of the US to the JCPOA and its commitments under the UN Security Council Resolution 2231 and under the JCPOA itself.

He underlined that Iran’s main goal was to ensure that no one else in Washington could once again humiliate the whole world by exiting a signed agreement. The spokesman was referring to former U.S. President Donald Trump’s decision in 2018 to cease U.S. participation in the JCPOA.

He noted Tehran will soon finalize its internal deliberations on the resumption of the JCPOA revival talks.

Khatibzadeh said Deputy Foreign Minister Baqeri-Kani, who is likely to lead Iran’s new negotiating team in Vienna, will publicly discuss issues about the challenges and obstacles in the talks.

The spokesman reiterated that the U.S. must uphold its commitments as stipulated in the nuclear deal signed between Iran and the world powers in 2015, noting that no practical steps have been taken so far by Washington.

He said the Joe Biden administration is continuing the former administration’s “maximum pressure campaign” against Iran and that there has been “no change in its policies”.

In response to a question about Foreign Minister Hossein Amir-Abdollahian’s statement made on Sunday that the U.S. must take “serious steps” before the resumption of talks in Vienna, Khatibzadeh said the remarks are an “expression of logic” and do not imply any message to the Americans.

He called on the U.S. to “reconsider its policy” toward Iran and “show it in practice” by removing the draconian sanctions and returning to the deal as well as guaranteeing that the agreement won’t be breached again.

On the negotiations between Iran and Saudi Arabia on resumption of normal ties, the diplomat said that four rounds of talks have been held in Baghdad, but the negotiations haven’t reached a point that the details could be announced.

He also touched on the accusations made by Azerbaijan Republic officials against Iran, urging Azerbaijani leaders to let the conversations between officials be continued through diplomatic channels and avoid negative media statements.

The Spokesman also said that the relationship between Iran and the Azerbaijan Republic was natural, but stressed that Azerbaijani officials should be cautious not to be trapped by third parties.

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Geo-Politics

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Last week. December Comex gold futures settled at $1951.70, up $71.80 or +3.82%.

Biden crossed the threshold of the 270 Electoral College votes required for victory on Saturday by winning the battleground state of Pennsylvania. Republicans appear to have retained control of the Senate, though the final makeup may not be clear until runoff votes in Georgia in January.

Essentially, it was the weaker U.S. Dollar that drove dollar-denominated gold higher. “Price of Gold Fundamental Weekly Forecast – More Accommodative Fed Key to Next Price Surge”

Lower Dollar, Higher Gold

A Democratic president and House, and a Republican Senate is ideal for the gold market. Since neither party controls the Congress, both trade wars and higher taxes are largely off the table. Furthermore, the prospect of more gridlock also means that expectations for a massive U.S. fiscal stimulus package have been lowered.

Removing massive coronavirus stimulus from the agenda sent bond yields sharply lower in anticipation of less borrowing and more quantitative easing from the U.S. Federal Reserve.

The plunge in long-term U.S. Treasury Bond yields made the dollar a less-attractive investment, driving up demand for gold.

“Price of Gold Fundamental Weekly Forecast – More Accommodative Fed Key to Next Price Surge”

Fed Keeps Policy Steady

The Federal Reserve kept its loose monetary policy intact on Thursday and pledged again to do whatever it can in coming months to sustain a U.S. economic recovery losing speed amid a spreading coronavirus pandemic.

The economy is still growing but “I would not say that anybody is feeling comfortable about this,” Fed Chair Jerome Powell said in a news conference after the Fed’s latest two-day policy meeting. “We’ve gotten through the first five, six months of expansion better than expected…But we have to be humble where we are relative to this disease. It has not gone away.”

Weekly Forecast

We’re looking for higher gold prices over the near-term although we do realize that speculators may have jumped the gun on the bullish news last week. The short-term outlook is clouded by doubts where fiscal policy may be headed in coming weeks, or how smooth the transition between an incoming Democratic administration led by Joe Biden and lame-duck administration led by Republican President Donald Trump will be.

We are certain that a combination of fiscal stimulus, no matter what size, and a continuation of the Fed’s emergency programs will be bearish for the U.S. Dollar and bullish for gold prices.

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