Suppression of interest rates is beneficial to the stock market? / Submission of the government to the beneficiaries

According to Tejarat News, the story Interest rate suppression Interbanking and its impact on the stock market has long become a challenge among stock exchanges and economic experts. Capital market activists still believe that the interest rate should be kept in the 20% channel and its increase has a negative effect on the stock market. However, a quick look at the history of interbank interest rate suppression shows other results.

Stock market and suppression of interbank interest rates

From January 16 of last year to July 16 of this year, when the interbank interest rate was suppressed in the 20% channel, not only the entry of money into the stock market did not increase, but the market witnessed a heavy outflow of money.

Despite this unsuccessful experience of the stock exchange in suppressing the interbank interest rate, market activists still believe that maintaining the interbank interest rate in the 20% channel will be accompanied by an increase in the acceptance of real estates in the market. This also caused the pressure of stock market activists and beneficiaries on the government central bank became.

These pressures caused Ehsan Khandozi to announce after the interbank interest rate reached 21.3% at the end of July, that the policy of the economic team to keep the interbank interest rate at 20% has not changed. In this regard, it was announced that a decision will be made in the meeting of the Money and Credit Council to solve this issue. It was after these statements that the interbank profit started a downward trend and reached 20% at the end of last week.

A plague called self-interested economy

The decrease in interbank interest shows that populist measures and meeting the demands of stock market stakeholders are a priority for the government to improve the economic situation. Because economic experts have repeatedly warned about the inflationary consequences of interbank interest rate suppression.

The current situation of Iran’s economy is also the result of these self-interested decisions in the past. Actions that make the rich richer and the poor poorer. It seems that the 13th government did not have the intention or at least the ability to change these conditions and fueled it with its decisions.