Iran raising deposit rates to control rial's depreciation, TV reports

Iran raising deposit rates to control rial's depreciation, TV reports

A video by State broadcaster, IRINN, showed a video of dozens of currency changers being rounded up by police.

After a month of surveillance, around 90 money changers were arrested in 10 minutes in the streets of Tehran, police chief General Hossein Rahimi told Fars News Agency on Wednesday.

Iran's currency has lost one-quarter of its value in six months, collapsing from 38,400 rials to the dollar in July to a record low near 50,000 in trading on the London currency exchange this week.

In the meantime, gold coin was traded in Iran at 15,965,000 rials (about $328.9 at the free market rates) on February 13, indicating a rise of 1.4 percent compared to the preceding day. The currency since then has dropped to a record low of 48,400 on Wednesday.

Iran's economic ties with foreign countries could be damaged further if the United States pulls out of the nuclear accord, as U.S. President Donald Trump has threatened to do.

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This coincided with a wave of arrests targeting the currency market in central Tehran, in "coordination" between the Iranian police and the Central Bank.

Iran's government has in recent days repeatedly called on people to refrain from rushing to panic buy hard currencies or follow speculators.

Aggressive purchases of dollars by currency speculators appear to have sped up the rial's decline; central bank governor Valiollah Seif warned speculators last month not to bet against the currency, but that did not change the trend. The Central Bank of Iran (CBI) put the official rate of euro at 45,539 rials.

Iran's nuclear deal with world powers, which lifted many global sanctions, had raised hopes that the currency would regain its lost value.

With many banks looking shaky, Iran's central bank decreed they could no long offer rates above 15 percent - a move which traders say pushed many back towards the dollar.

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