Currency News: The End of a Dual Exchange Rate System in Iran & Brexit Effects on Tourism
Currency News
Iran: The end of a dual exchange rate system
Iran’s central bank is signaling that it will loosen its grip on the rial in an effort to end a dual-exchange rate system seen as an obstacle deterring foreign investment needed to rebuild the economy. Policy makers, in a decision reported earlier this month, allowed commercial lenders to buy foreign currencies using rial rates set by the market rather than those dictated by the central bank.Bas du formulaire
Simplification could help attract foreign investors. Bringing foreign currency inside Iran, changing it to rials using the official rate and then returning their revenue at the market rate can lead to diminished profit. But, for local businesses, using exchange houses is not the most reliable medium and leads to higher costs.
A single rate will also cut down on corruption by increasing transparency. There will be less confusion and more confidence for foreign companies planning to enter the Iranian market.
Brexit effects on tourism
Bargain-hunting tourists are flocking to the UK to exploit the plunging pound but Britons are burning money on their summer holiday in Europe.
The dramatic slide in sterling since the Brexit vote has given British holidaymakers enough pain already. There has, however, been a benefit for the British economy. Indeed, an influx of big-spending overseas tourists from the likes of the US, China, and Hong Kong apparently helped.
London is experiencing a surge in visitors exploiting the cheap pound as well as Manchester, Liverpool, Leeds, and Scotland. “For so long it has been, ‘I love going to London but it’s so expensive.’ Now it’s so much cheaper, we’ve seen a big increase in short-term bookings to London and regional UK,” said Kenny Jacobs, Ryanair’s chief marketing officer.
