How does the World Bank predict the future price of the dollar in Iran?
In its latest report, the World Bank has announced the increase in pressure on Iran’s foreign exchange reserves. News that could mean an increase in the price of the dollar in the second half of the year.
In this report, the World Bank has analyzed various economic indicators, including economic growth and inflation, and the status of other indicators and sectors of the economy, and in a part of this report, it has explained how Iran’s economic conditions this year will lead to increased pressure on foreign exchange reserves. .
4 factors affecting the price of the dollar
In this report, according to the inflation expectations, currency pressures and the growing budget deficit, it is predicted that inflation will remain high and the inflation rate in Iran’s economy will reach 49.6 percent next year. The increase in inflation is one of the factors that leads to an increase in the price of currency from the point of view of the World Bank.
But other factors also affect the price of the dollar. In the continuation of this report, it is predicted that, on the one hand, the global oil demand will decrease, and on the other hand, Russia will increase its oil exports. The increase in oil production along with the decrease in demand causes a decrease in Iran’s oil revenues and causes the current account balance in Iran to remain low. This condition means a decrease in oil revenues, which is another important factor that affects the price of the currency.
But that’s not all. This report predicts that the outflow of capital from Iran’s economy will accelerate next year. Besides this issue, Iran will not have access to its foreign reserves. Capital outflow on the one hand and lack of access to foreign resources on the other hand cause the pressure on Iran’s foreign exchange reserves to increase.
Various statistics confirm the outflow of capital from Iran’s economy and show that the speed of capital outflow from Iran has intensified. On the other hand, sanctions and domestic economic conditions have gone in a direction that has hindered the attraction of new capital in Iran. This problem has caused new capital not to enter Iran’s economy and Iran’s economic growth rate has remained low for several years in a row. Meanwhile, in the seventh development plan, it is emphasized that Iran’s economy needs 10 billion euros of new capital per year for economic growth of 8%.
On the other hand, according to various officials, Iran has many sources of currency in different countries, and the government has sometimes been able to reduce the price of the dollar in the open market by promising to release these sources. But it was a few weeks ago that the assignment of some of these blocked resources was determined. 7 billion dollars of Iran’s blocked resources in South Korea have finally been released. But it did not reach Iran. These freed resources went to Qatar to enter Iran in the form of humanitarian goods. A problem that shows that Iran’s economy cannot hope for the release of these resources.
Dollar price forecast quoted from internal sources
Since the beginning of this year, the government has been able to control the price of the dollar. The dollar started working in the middle channel of 55 thousand tomans from the beginning of the year. However, since the beginning of June, the news of the possibility of revitalizing the nuclear agreement was able to bring the price of the dollar below the channel of 50 thousand tomans and keep it in this range. In the last three months, the price of the dollar in the channel fluctuated between 48 and 50 thousand tomans, and the market maker was able to keep the price of the dollar in this range.
Economic experts say that the price of the dollar will probably remain in the current range until the end of October and November, but how much the dollar will be in the last few months of the year is a question for which experts do not have a clear answer. The Program and Budget Organization predicted in a report last month that the price of the dollar will reach 52 thousand tomans by the end of 1402. But economic experts believe that such a forecast about the price of the dollar is optimistic, and only if the JCPOA is revived, the dollar can remain in this range.
Apart from this, the budget deficit and the increase in liquidity take the price of the dollar out of the control of the government and cause the price of the dollar to enter higher channels. Unless the government can initiate a series of economic reforms, which are unlikely to exist.
Source: Tejarat News