The Economic Sanctions and the Iranian Exchange Rate Crisis of September-December 2012

摘要

The signing of the "Iran Threat Reduction and Syria Human Rights Act of 2012" by President Barak Obama on August 17, 2012 resulted in a massive depreciation of the Iranian currency, the rial, by December 2012. The news of new sanctions on the petroleum and financial sectors of the Iranian economy was taken as a "Sudden Stop" in capital inflow into the country and was a "displacement," which led to the currency crisis. In this article #within the framework of the Minsky's theory of financial fragility of the market economies #we discuss the details of the currency crisis after the imposition of economic sanctions against Iranian petroleum and banking sectors #and the Iranian government's anti-speculative and stabilization policies. The article adds to our stock of knowledge of the occurrence currency crisis despite substantial foreign reserves holding of the Iranian banking system.