Nuclear extension, oil price rattle Iranian markets
The extension of the nuclear talks for another seven months means sanctions are not lifted and the precipitous drop in oil prices has rattled Iranian markets.
Three weeks after nuclear talks in Vienna failed to put an end to the 12-year nuclear standoff between Iran and the West, forex and the stock and gold markets in Tehran are still nosediving, with Iran's monetary officials struggling to control the negative sentiment.
The rial lost over 3,200 against the dollar and traded at 35,600 on Nov. 30, its lowest value against the dollar since President Hassan Rouhani took office more than a year ago. The rial's depreciation came six days after Iran and the six world powers (China, France, Germany, Russia, the United Kingdom and the United States), known as the P5+1, agreed to extend talks, a decision that means seven more months of economic sanctions.
Although the dollar retreated somewhat in the following days, it was still traded at 34,270 rials Dec. 11 on Ferdowsi Street, the main forex market in Tehran. The rate is still much higher than the 32,380 rials Nov. 23, a day before the talks failed to reach a comprehensive deal, which was widely expected in Iran.
TEDPIX, the Tehran Stock Exchange’s main index, also dropped drastically on Nov. 25 as skeptical investors flocked to sell their stocks. The bearish sentiment has been dominant in the market since. The index has been falling from 75,949 on Nov. 24 to 71,043 on Dec. 10, the lowest level in five months. Market experts do not have any better hope for the coming days. So far, the Tehran Stock Exchange has plunged over the last three weeks by 1.5% to 3%.
