Iran central bank governor rejects US claims of economic collapse amid blockade

Bangkok, Thailand. Iran’s central bank governor, Hemmati, dismissed Washington’s claims that the Iranian economy was collapsing as illusory during an International Monetary Fund meeting on Wednesday. His remarks came as Tehran faced a US naval blockade intended to eliminate its oil exports and deplete government funds.

Blockade and widening restrictions

Washington restored the blockade targeting Iranian ports in July. On August 24, it began Operation Economic Outcast, seeking to cut Iran’s surviving commercial and financial connections with the world economy.

The campaign widened in September to include Iranian airlines, increasing the country’s isolation while making connections abroad more restricted and expensive.

Data from energy intelligence platform Vortexa showed that Iran’s seaborne crude exports dropped to zero during September’s second week. At the beginning of that month, their 14-day average had been 230,000 barrels a day. Exports were still at zero on October 5.

Rial losses and rising inflation

The US pressure has coincided with a steep depreciation of Iran’s currency. Exchange-rate figures from Iranian currency tracker Bonbast indicated that the rial had declined by nearly 35% against the US dollar since July.

The Statistical Centre of Iran reported annual inflation of 73.6% for September.

Central bank priorities

Hemmati said the central bank’s priorities included containing inflation and steadying expectations about price rises. He also cited safeguarding financial stability, keeping banking and payment services operating, and obtaining foreign currency to pay for medicine and essential goods.

In late September, the central bank introduced a programme to support the rial by selling as much as $2 billion through state banks.