CBI boosts gold reserves to fortify financial stability, slash forex reliance
The Central Bank of Iran (CBI) has adopted a strategic policy to increase its gold reserves over the past two years, effectively following the path of leading countries and aligning with international standards for strengthening financial stability, a senior CBI official said, as reported by IRNA.
Yekta Ashrafi, deputy for management and resources at the CBI, said the strategy has been adopted to strengthen financial stability, reduce reliance on foreign currencies, and enhance the resilience of the national economy.
“The increase in gold reserves — the inflow of which we are currently witnessing into our country — not only strengthens the backing of the national currency but also reflects the strategic understanding of the country’s economic policymakers regarding the need to reduce dependence on foreign currencies and enhance the resilience of the national economy,” she said.
Earlier reports indicated that two foreign investors recently imported standard gold bullion worth around $4 million into Iran, marking the first such transaction conducted through the country’s Foreign Exchange and Gold Center. The CBI had previously restricted gold imports to manage the foreign currency market and curb smuggling. In November 2022, Iran cut tariffs on gold imports to zero to boost reserves and facilitate the return of funds held abroad due to US sanctions.
Ashrafi said the gold reserve policy “practically follows the path of leading countries and aligns with international standards for managing gold and foreign currency reserves.”
She added that the decision was made “within the framework of financial risk management principles, diversification of reserve assets, and maintaining the purchasing power of the national currency,” reflecting a forward-looking and smart approach to monetary policy.
Citing both classical and modern monetary theories, she noted, “Gold, as a safe-haven asset, plays a stabilizing role against currency fluctuations and inflation. Increasing gold reserves significantly enhances the Central Bank’s capacity to manage liquidity, control exchange rate shocks, and reduce systemic risks.”
Ashrafi highlighted the diversification of reserve assets as another key objective of the CBI. “International evidence shows that countries with diversified reserve portfolios, including a mix of major currencies and gold, are less vulnerable to financial crises and have more flexible monetary policies,” Ashrafi said.
He also stressed that increasing gold reserves strengthens the bank’s ability to pursue the policy of independence.