0743 GMT January 22, 2022
Akbar Komijani said that the CBI has been making preparations to issue the deposit bonds, Press TV reported.
“We hope we can use this instrument this year (to March 2022) to control money base and the inflation rate,” said Komijani addressing Iran’s Islamic Banking Conference, an annual gathering of senior government officials and major economists held virtually this year due to the coronavirus restrictions.
Komijani said deposit bonds will replace corporate bonds issued by the CBI over the past two decades.
Deposit bonds were approved in 2019 by members of the CBI’s Jurisprudence Council, a body which screens monetary policies and banking mechanisms to decide if they comply with the Islamic principles.
Under the scheme, bond holders would deposit their funds in a frozen account in the CBI and the lender guarantees to repay the funds on the maturity date based on actual market prices.
The monetary policy is meant to help the government and the CBI to reduce the money supply and to influence the consumer prices in the Iranian market.
Iran has seen high but controlled levels of inflation in the past three years as the economy has struggled under the double burden of the US sanctions as well as the spread of the coronavirus pandemic.
Bond issuance has been a major part of CBI’s monetary policy in recent years as the bank has sought to help the government gain funds needed to finish its massive development projects.