The dollar will reach 60,000 Tomans by the evening of Eid.
According to Iran Gate, the price of the US dollar in the Tehran foreign exchange market has crossed the 52,000 Toman threshold in certain conditions, and we are witnessing a sharp and extremely rapid decline in the value of the rial every hour. Now market activists, who believed that the ceiling for the dollar exchange rate in 2022 would be 50,000 Tomans, are changing their strategies and are waiting for the dollar to reach 60,000 Tomans by the arrival of Nowruz 2023.
The Tehran foreign exchange market is witnessing astonishing records of the dollar exchange rate every hour and every moment. Many believe that this record-breaking trend will continue until the end of the current year, and it is not unlikely that the ceiling of 60,000 Tomans for the dollar exchange rate will soon be broken.
Historical record of the dollar after Raisi’s promise to control prices.
Last week, Ebrahim Raisi promised to control the exchange rate and stated that every US dollar would be traded within the range of 48,000 Tomans. However, now, after only 5 days have passed since this promise, we are witnessing the registration of a price of 52,000 Tomans for the dollar in the Tehran free market.
Although the government has stated that it does not recognize these rates officially, the markets do not care about the statements of government officials. The prices of all goods, from housing and cars to food and services, have been affected by the continuous and escalating depreciation of the value of the Iranian rial.
Although economists believe that the markets still reflect the impact of the 40,000-toman dollar, in other words, the current prices of consumer goods have not yet adjusted to the 52,000-toman dollar, and we should expect an unprecedented increase in the prices of goods and services coinciding with the arrival of the Persian New Year, 1402.
The 60,000-toman dollar in 1401
According to most experts, as long as Ibrahim Raisi’s economic team remains in power, the sanctions will continue to be in place and there will be no slightest opening in terms of monetary transfers. There will definitely be no ceiling for the increase in the dollar rate or, more accurately, the depreciation of the rial. However, the question arises whether it is possible for the dollar rate to break the 60,000-toman ceiling this year.
Market analysts and currency market participants believe that in the final days of the year 1401 (Iranian calendar), the Iranian economy will face very difficult days. On one hand, the government promises to control prices, relying on currency injection policies. However, everyone is aware that the government’s access to foreign currency resources is severely limited, and the central bank is unable to engage in extensive currency injection in the foreign exchange market.
If such a possibility existed, we would certainly continue to witness the stabilization of the dollar price even after the end of the ‘Decade of Fajr’ (a period commemorating the Islamic Revolution). The current astonishing records would not be set. Interestingly, immediately after the anniversary celebration of the victory of the Islamic Revolution on February 11th, the dollar price started to rise, and in less than 10 days, the national currency lost more than 15% of its value.
Given these conditions, experts believe that the possibility of recording a 60,000-toman exchange rate for the dollar in the free market before the arrival of Nowruz 1402 was completely feasible and cannot be ignored. However, it is natural for the government and the central bank to continue taking measures, including media restrictions on price announcements or limited currency injections. Nonetheless, analysts believe that the crossing of the dollar from the 57,000-toman price channel is a signal for the exchange rate to enter the 60,000-toman channel in 1401.
To put it simply, if the dollar price also exceeds 57,000 tomans in the remaining days of this year, it can certainly be expected that we will witness the recording of a 60,000-toman exchange rate for the currency in the coming days. Considering the evidence from the behavior of the government and the central bank, it is unlikely that there will be any possibility of suppressing or compressing the dollar exchange rate in the remaining days of 1401. In fact, it should be said that breaking the 60,000-toman ceiling for the dollar exchange rate is not only insignificant but also likely to result in the price being stuck in the range of 50,000 to 55,000 tomans.
Identifying the floor and ceiling of the currency exchange rate in 1402
The economic coordinates of Iran indicate the presence of a time bomb under the Iranian currency, a bomb that can explode at any moment with a small spark, but the timing of this explosion cannot be predicted. However, what can be analyzed is the prediction of the exchange rate under the assumption that the current conditions of the country remain constant.
Currency market players these days are designing a new strategy for the year 1402, expecting a ceiling between 70,000 to 75,000 tomans, and the floor of these analyses is in the range of 55,000 to 60,000 tomans.
Although some economists believe that if the current conditions of the country do not change and there is no opening in the field of monetary transfers, even the US dollar may be traded at prices ranging from 85,000 to 95,000 tomans in the year 1402. Of course, this analysis is based on intensifying pressures against the Islamic Republic and the increasingly difficult conditions for accessing foreign currency resources in the country. If it happens, this analysis can pave the way for new protests that will undermine the foundations of governance.
However, if we take a balanced look at the currency market, it is likely that the price of the US dollar will fluctuate between 65,000 to 70,000 tomans and will end the year 1402 in this range. However, the timing of these prices being seen and reached is another matter that depends on the developments in the world and Iran in the areas of politics, economy, and even society.
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