Iranian central bank announced dropping 4 zeros from Iranian currency strengthening to world level
Iranian satellite news channel announced the central bank has finished the preparation of dropping 4 zeros from Iranian currency strengthening to world level.
For example right now from all sanctions and etc.. 1 US dollar is over 12000 rial and 40000 rial on blackmarket. but if the 4 zeros drop then 1 US dollar will be 1.2 rial and 4 rial respectively.
It will greatly strengthen Iranian economy and release the hardship of high costs of goods for Iranians.
Now the fun part will be the super rich Iranians will not longer be super rich and the gap between upper class and lower class will become smaller.
Also Ahmadinejad announced that because of higher inflation a determined amount of money or funds will be given to Iranian family. The government will return more money to people soon.
There was a old news article from last year when Iran wanted to drop zeros and the reason given was to ‘strengthen rial’ and wrote how it will do that. I can not seem to find it through google search.
Anyway dropping zeros along with stopping import of foreign goods replacing it with domestic goods (has already started since last year. Many good are now prohibited from being imported)and other measures of dropping or phasing out dollar and euro as it was in the news recently, plus increasing the gold reserve (Iranian tv showed Iranian gold reserve increased by 100 tons this past year) and government subsidies thats going on now (every 2 to 3 months government deposits some money to Iranian low income families); All these and others can boost the economy and Irans currency in coming years.
The dropping of zeros is not just alone. There are other factors Iran has put in place by Ahmadinejad government.
So we have to wait and see what will happen. Iran contradicts every economic models in the world. What the world think it will happen will have opposite effect in Iran.
2011: Dropping zero(s) from Iran’s currency
2011: Iran to delete three zero’s from its currency this year