March 4 (Bloomberg) -- Iran’s Central Bank plans to issue banknotes with twice the value of the largest ones in circulation, Donya-e-Eqtesad reported, citing Majid Saniei, an official at the financial institution.
The bank will start printing 200,000-rial ($16) banknotes as soon as it receives permission from the Economy Ministry and will release the new notes into circulation in the Iranian new year starting March 21, the Tehran-based daily quoted Saniei, head of Iran’s security and minting organization, as saying.
The Central Bank is also seeking approval for 500,000-rial notes and plans to introduce these in two years’ time, Saniei said. Iran’s largest banknote at the moment is 100,000 rials.
The rial has weakened in the past year as the Persian Gulf country battles U.S. and European Union economic sanctions which have contributed to an inflation rate nearing 30 percent. Iran’s Central Bank estimates inflation will rise to between 30.6% and 31.5% in the Iranian month of Esfand ending March 20, Central Bank Governor Mahmoud Bahmani said last month. Iran is at loggerheads with Western powers over its nuclear program.
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