Saturday, 08 August, 2020

Iran’s M2 money supply grows by 34.2% in year to late June: Report

Iran’s money supply (M2) has grown by more than a third year-on-year in late June, a new report by the semi-official Fars news agency shows.

The report published on Sunday said that money supply reached 26,571.700 trillion rials (nearly $121 billion) in the year ending June 20, an increase of 34.2 percent compared to the previous year.

Money supply grew by 7.5 percent against the end of Iranian fiscal year on March 19, said the report.

Near money supply (M1), which includes cash and short-term deposits, was up 29.1 percent against late June 2019 at 21,551.200 trillion rials (nearly $98 billion), it said.

The balance of monetary base, or the amount of cash in circulation and deposits at the Central Bank of Iran, grew by 39.6 percent against June 2019 and 8.6 percent against late March 2020 to stand at 3,833.500 trillion rials ($17.5 billion) in late June 2020, tables by Fars showed.

However, bank notes and coins in general circulation in the hands of the public declined by 5.5 percent in the three-month period ending June 2020 to 578.000 trillion rials ($2.7 billion), although figures showed that currency in circulation had increased 15.1 percent compared to the year ending late June 2019.

Growth in amount of money was double the growth of the amount of near money, showed the figures, as money reached 5,020.500 trillion rials (nearly $23 billion) in June 2020, an increase of 61.5 percent year on year.

That double rise proves earlier estimates by some economists suggesting that people would tend to use their saving deposits to buy shares in Iran’s burgeoning stock market, a trend which has been visible through the past months.

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