CBI forms Open Market Operations executive committee

The governor of Central Bank of Iran (CBI) has officially announced the formation of an executive committee on Open Market Operations (OMO), introducing the committee members.

TEHRAN TIMES – Abdolnasser Hemmati in a decree on Sunday appointed Mohammad Nadali, Mahmoud Naderi Kazaj, Ahmad Goudarzi, Reza Bostani and Houman Karami Khorramabadi as members of OMO Executive Committee, IRIB reported.
Mohammad Nadali was also appointed as the head of the committee.
Monetary policy formulation and monitoring, supervising and monitoring monetary transfers, formulation and monitoring of position announcements, planning and monitoring of the interbank market, planning, monitoring and implementation of open market operations, and proposing monetary policy regulations and monitoring models are reported to be some of the most important tasks that the committee should follow.
In mid-April, CBI Money and Credit Council approved a plan to allow the bank to engage in open market operations for the first time.
The policy was approved as part of the CBI plan to implement new instruments in its monetary policy, regulate interest rates, curb inflation, and develop a regulated framework for controlling banks’ borrowings from the CBI.
OMO is a financial instrument through which central banks buy and sell securities in the open market to expand or reduce money supply.
Within the OMO, the CBI buys government bonds to increase the money base (cash reserves), thereby reducing inter-banking lending rates. Selling government bonds decreases the base money and raises interbank rates.

Publish Date: Sep 23, 2019