Aug. 6 (UPI) -- The Iranian government has announced monetary changes intended to reinforce the strength of its currency, the rial, in the face of new U.S. sanctions.
The governor of the Central Bank of Iran, Abdolnasser Hemmati, unveiled the package late Sunday, saying the new policy will strengthen currency despite the new fiscal penalty.
Under the U.S. sanctions scheduled to take effect Tuesday, Iran is barred from purchasing or acquiring U.S. dollars.
The policy changes include a "secondary currency market," launched last month after the Iranian rial sunk to a record low against the U.S. dollar. The rial has lost half its value so far this year.
With the secondary market, Iran's Central Bank would not be involved in determining dollar exchange rates, which critics argued only resulted in producing "unrealistic rates."
Instead of the bank determining exchange rates for main exports like natural gas, steel and other metals, they would be tied to a "floating market" of "supply and demand," Hemmati told IRNA.
"The Central Bank will not interfere in the rates, but it will use its powerful currency to manage the market if necessary. That is, the 'floating market' will be controlled," he sad.
Meanwhile, the European Union's diplomatic service issued a statement Monday on the U.S. sanctions against Iran.
"We deeply regret the re-imposition of sanctions by the U.S., due to the latter's withdrawal from the Joint Comprehensive Plan of Action," the statement said. "The JCPOA is working and delivering on its goal, namely to ensure that the Iranian program remains exclusively peaceful, as confirmed by the International Atomic Energy Agency in 11 consecutive reports. It is a key element of the global nuclear non-proliferation architecture, crucial for the security of Europe, the region, and the entire world. We expect Iran to continue to fully implement all its nuclear commitments under the JCPOA."