The Iranian Central Bank has established the secondary currency market to allow exporters of non-oil goods to sell their foreign currency earnings to importers of consumer products as part of Tehran's strategy to ease conditions amid the resumption of US sanctions.
Iranian Central Bank governor Valiollah Seif said the secondary currency market would help "minor importers" buy their dollars, and emphasized that the price of the dollar would be set according to market supply and demand, Press TV has reported.
The move will allow some 20% of the dollars from the export of non-oil products (also excluding steel, petrochemical and minerals) to be sold in the secondary currency market at rates mutually agreed upon by exporters and importers.
A man displays 500 Indian rupee notes during a rally organised by India’s main opposition Congress party against the government's decision to withdraw 500 and 1000 Indian rupee banknotes from circulation, in Ajmer, India, November 24, 2016.
India, Iran Discuss Banking Process, Rupee-Rial Trade to Withstand US Sanctions
The Central Bank's decision comes amid new record-lows in the exchange rate for the US dollar on the unofficial market, with the Iranian rial dropping as low as 87,000 rials to the dollar on Sunday against about 75,500 late last week. The rial's plunge in the spring prompted authorities to close numerous currency exchanges amid suspected speculative operations Tehran believed were contributing to the drop and causing turmoil in the exchange rate. As of mid-2018, the rial has dropped by well over half compared to mid-2017's rate of 37,700 rial per dollar.
President Trump's decision to pull out of the Iran nuclear deal and reimpose sanctions against Tehran is also believed to have played a role in the rial's ongoing depreciation.
Iran has sought to reduce dependence on the dollar via a package of measures, including increased trade using the euro and other currencies.