The volume of liquidity reached 4823 thousand billion

The Central Bank published the report “Analysis of Macroeconomic Developments and the Bank’s Actions in April 1401”.

The report of the bank states: Management of inflation expectations as one of the important pillars in the field of curbing inflation, requires the provision of accurate and timely information on macroeconomic developments and the actions of the central bank to individuals and economic actors. This will allow the central bank, in addition to the correct formation of expectations, to pursue the goals of preserving the value of the national currency (controlling inflation) and contributing to economic growth in better conditions.

Accordingly, a summary of the macroeconomic developments and the actions of the Central Bank in order to achieve its goals and missions in April 1401 is presented below.

1- Macroeconomic developments

An examination of the inflation rate trend in April 1401 shows that the twelve-month inflation continued with its relative downward trend, which began in October 1400, with a relative decrease; However, point-to-point and monthly inflation have increased compared to the previous month. In this month, the group of goods with a coefficient of importance (48.5%) and its main subgroup, namely “food and beverages” with a coefficient of importance (25.5%) with an increase in inflation of 2.9 and 4.1 percentage points, respectively, compared to the month They were together before.

On the other hand, the service group with a significance coefficient (51.5%) was faced with a decrease of 0.5 percentage points of monthly inflation. In this regard, although the subgroup “Housing, water, electricity and gas and other fuels” (significance coefficient 37.1%) was associated with a decrease in monthly inflation, but some service subgroups such as the index “service in the health care group” and the index “service” In the “transport group”, they experienced an increase in monthly inflation of 0.5 and 0.2 percentage points, respectively.

In the field of foreign trade, according to the news published in the Customs Information Database of the Islamic Republic of Iran, in April 1401, the value of customs exports was about $ 3.7 billion, which indicates a 25% increase compared to the same month last year. The value of customs imports in the reported month is about $ 2.8 billion, which indicates an increase of about one percent compared to April 1400. In total, due to these developments, during the first month of this year, the customs trade balance was accompanied by a surplus of $ 875 million.

Developments in the foreign exchange market (Nima system and the organized market of Iranian foreign exchange transactions) in April indicate that in this month, the average monthly rate of dollar sales in the remittance and banknote market has increased slightly compared to the previous month. In April, the average selling rate of remittance dollars and banknotes in the Senate system was about 244.4 and 253.0 thousand rials, respectively, which show an increase of 1.3 and 3.1 percent, respectively, compared to March 1400.

In the housing market and based on the information obtained from the real estate transaction registration system of the country, the average purchase and sale price of one square meter of residential unit traded in Tehran during April 1401 decreased by 2.4% compared to the previous month and compared to The same month last year experienced a 16.9 percent increase.

This amount is much lower than the point-to-point growth of April 1400 (equivalent to 91.7%) and indicates the slowdown in the growth rate of capital housing prices in 1401. In the stock market, the total index of the stock exchange on the last day of April increased by 10.6% compared to the last day of the previous month. It should be noted that the monetary policymaker, by constantly monitoring the developments in asset prices and paying attention to its implications for changing the level of inflation expectations, will put appropriate policy measures on the agenda when necessary.

Interbank market developments in April 1401

Regarding the developments in the interbank market in April, it should be noted that at the beginning of this year, due to the decrease in banks’ liquidity needs due to the end of the previous month and the lack of government auctions, the funds available in the interbank market increased. The increase in the average daily trading volume and the stabilization of the market rate in the previous range, which led to a decrease in the use of central bank banks and credit institutions in short-term financing.

Also in April of this year, mainly due to the lack of supply of new government Islamic financial securities by the government in the primary market and the relative stabilization of the interest rate of the rial interbank market, the downward trend in the rates of return of government Islamic financial securities that began in December last year; In this month, the rate of return of the mentioned documents with maturities of one, two and three years, with 0.63, 0.43 and 0.52 percentage points, respectively, compared to the previous month, to 21.77, 22.63 and 22.90, respectively. Percentage reached.

However, since January 1400, with the reduction of the rates of return on government Islamic securities, the yield curves of Islamic treasury bills have been lowered; So that the April yield curve is at a lower level than the yield curves three months earlier.

The volume of liquidity at the end of April 1401 (equivalent to 48234.0 thousand billion rials) compared to the end of 1400 has decreased by 0.2 percent. Also, the twelve-month growth rate of liquidity in April 1401 was equal to 38.2 percent. It should be noted that about 2.6 percentage points of liquidity growth in 1401 related to the addition of the summary information of the General Office of Assets and Debts of Mehr Eghtesad Bank to the summary information of the General Office of Assets and Debts of Sepah Bank (due to the merger of banks owned by the Armed Forces In Sepah Bank) and has no monetary effects.

In other words, if the effects of the statistical coverage are adjusted, the growth of liquidity at the end of April 1401 compared to the end of April 1400 was equal to 35.6 percent. A study of the trend of liquidity components (money and quasi-money) in 1401 also shows an improvement in the composition of liquidity and a decrease in the fluidity of money, so that the share of money in liquidity decreased from 20.4% at the end of 1400 to 19.7% at the end of April 1401. And the share of quasi-money in liquidity has increased from 79.6% to 80.3% in this period.

2- Central Bank actions

In April 1401, with the aim of managing the liquidity of the Rial interbank market, the Central Bank, in interaction with banks, took the following credit measures:
Carrying out open market operations with an expansion position during three auctions worth 940.3, 934.3 and 937.4 thousand Rials, respectively, with a total transaction value of 2812.0 thousand billion Rials in the form of a repurchase agreement with 7-day maturities (balance of repurchase agreement balance). From the place of open market operations at the end of April, it was equal to 937.4 thousand billion Rials).
Banks’ use of regular credit at the ceiling rate to meet liquidity needs during 8 days with a total transaction value of 89.5 thousand billion rials (regular credit balance at the end of April was zero).
The brokerage of this bank has not held an auction of Islamic securities from the beginning of this year until the end of April.