Central Bank of Iran Pins Hope on OMO to Curb Inflationary Effects of Liquidity

The Central Bank of Iran is now focused on the upcoming open market operation hoping that the monetary policy would help curb inflationary effects of the ballooning liquidity because previous measures failed to produce the desired results the bank’s governor said.

Financial Tribune- In an Instagram post Monday, Abdolnasser Hemmati wrote that the regulator will tap into OMO as it is indeed difficult to draw on the existing ineffective and limited methods, namely “controlling legal reserves and rationing credits”, conventionally used to control high and rising liquidity in Iran.
The CBI is resolved to “re-channel the impact of ‘high powered money’ on liquidity by establishing the OMO,” he wrote.

Sep 3, 2019