TEHRAN – The Governor of the Central Bank of Iran (CBI) has said predictability of the economy is a prerequisite for the stability of markets adding that the central bank welcomes the prosperity of the capital market.

“Stability of all markets along each other is of utmost importance for the central bank, therefore the bank supports the stability of the capital market,” Abdolnasser Hemmati said in a meeting with the representatives of the capital market.

He emphasized that the approach of the Central Bank is to support the capital market, stating: “One of my personal economic beliefs is that our problem in economics is the underdevelopment of financial markets and capital market in particular.”

According to Hemmati, inflation expectations affect the bank interest rates and consequently the market, therefore it is hoped that lower inflation expectations will lead to lower inflation and lower interest rates.

"All markets are highly sensitive to change and inflation expectations, and this is not limited to the capital market," Hemmati said.

The Iranian capital market has been going through some turbulence over the past few months and in this regard, the government and related entities have been taking serious measures for stabilizing the market.

EF/MA