November 18, 2016
Economy Minister Ali Tayeb-nia says he isn’t planning to chop any zeros off the rial any time soon.
The idea has been discussed for many years as an effort to make Iran’s currency more manageable for the public. It has no economic significance. But if $1 went from 36,000 rials to 36 rials, it would make life easier for shoppers.
Tayeb-nia said he supported the idea, but asserted the time was not yet right for doing so.
“I think dropping three zeros from the rial is a necessary measure that should be done in the future,” he said Sunday.
But he didn’t say how far in the future. He did say, “We need to fully reduce inflation and make the economy more stable before lopping off any zeros.” Inflation is still among the highest in the world, though it has now dropped a little below 10 percent per annum.
Kamran Nadri, deputy director of the Monetary and Baking Institute, said he thought lopping off zeroes would actually help reduce inflation, though that is not accepted as fact among many economists.
Nadri proposed cutting off four zeros, not just three.
Many countries have eliminated zeroes from badly inflated currency. In 1960, France dropped two zeroes. In 2004, Turkey lopped off six zeroes.
