The Iranian government says it has earned more than $6.55 billion from 35 weeks of bond auctions as it sells over $106 million worth of new bonds in the week to January 26.
The official IRNA news agency cited figures by the Ministry of Economic Affairs and Finance in a Wednesday report showing that a 35th round of weekly auctions for government-issued bonds had generated 25.26 trillion rials in new revenues.
It said total revenues derived from less than a year of Iran’s weekly bond auctions had exceeded 1,559 trillion rials of which some 547 trillion rials had come from Islamic-compliant bonds known as sukuk.
Bond issuance has been a major part of Iranian government’s efforts to shore up finances at a time of increased economic pressure on the country both because of a series of American sanctions and also the spread of the coronavirus pandemic which has led to reduced economic activity across various businesses.
A majority of the government-issued bonds are purchased by the corporate buyers, including private and government-run banks.
The government has backed the return on the bonds through various schemes, including a mechanism to reimburse sukuk-holders by giving them crude shipments or their cash equivalent on the day the bonds are matured.
Revenues derived from bond issuance have been mostly used to finish development projects across Iran as well as to fund economic rescue measures aimed at people affected by the pandemic.
Iran's finance ministry has defended weekly bond auctions as a safe policy with the “lowest possible inflationary impact on the economy”.
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