*Note: Data are based on the Iranian calendar year where each month ends approximately on 20th day of the corresponding month in the Western calendar year. Month's numbers for these data are converted to the closest western month only for convenience. (The current year of the Iranian calendar starts from March 21).


 

Inflation and Exchange Rate

It seems the indicator of the announced inflation rate does not go in line with the effective variables on inflation, including the 6% rise in foreign currency and 3% advance in housing sector, in the same month. The inflation rate is expected to soar in the coming months.

15% gain in foreign currency over the recent four months, i.e. key to pricing of import and consumer goods, is projected to affect the general inflation and make it hard to keep the inflation within one-digit range.


 

Interest Rate

The policies of CBI and the Ministry of Economic Affairs and Finance to tone down inter-bank competitions on attracting high-interest deposits, control fixed income funds, and issue bonds have been partly successful. Despite the encouraged parallel markets, the interest rate has been held at about 15%.


 

Real Estate

January 2018 witnessed advances in price and the number of transactions, signaling a boom in the sector. However, any price jump is unlikely given the other variables such as empty-left apartments, low public purchase power, and relatively low inflation.

In January trades, 50% of transactions were made at below 3 B IRR on the apartments with less than 5-year lifespan. This demonstrates low purchase price of the buyers and indicates Maskan Bank’s successful policies concerning granting facilities to those at their first house trade.

* Based on CBI’s latest report on Tehran housing sector.


 

Foreign Trade

As expected, the increased rate of foreign currency in the last three months triggered the export hike. With 26% growth compared to its last month, the export in December 2017 hit 3,972,000,000 USD which has been the highest since September 2017.   

Increased exports together with the relative stability of imports made the trade deficit to fall to 1,262,000,000 USD. The foreign currency appreciation is expected to make the exports to grow and the descending trend of trade deficit to carry on further.


 

Equities

Given the interest rate stability, global prices, and dollar appreciation, the rising trend of the Iranian capital market is expected to continue which seems logical factoring in the fundamental variables such as profitability and sales of companies. 

Also the advance of TEDPIX has been associated with the listed export-oriented companies in basic metals, chemicals, and metallic ore sectors which benefit always from the soar of foreign currency and global rates.

In the event of stability of the effective variables on equity market, the current ascending trend is expected to move up irrespective of short-term volatilities.


 

Assets' Returns (1 Year, Trailing)


 

GDP


 

About Mofid

Mofid Securities is a leading brokerage and investment advisory firm in Iran. As the largest full-service broker, it provides domestic and international clients with a range of trading and investment services including online stock trading, mutual funds, ETFs, and managed accounts as well as market reports and commentaries. 
Mofid publishes this newsletter, Iran Market Reporter (IMR), in order to keep its readers updated on the latest news and events of Iranian capital market, especially Tehran Stock Exchange (TSE), as well as valuable information for individual and institutional investors.
Iran Market Reporter (IMR) is distributed exclusively via email amongst Iranian analysts and potential investors who have worked closely or have been in contact with Mofid Securities Company. Subscription to this newsletter is by online request only.

 

DISCLAIMER

This material is for information purposes only and does not constitute an offer to sell nor a solicitation of an offer to buy any specific securities.

All information contained in this publication has been researched and compiled from sources believed to be accurate and reliable at the time of publishing. However, in view of the natural scope for human and/or mechanical error, either at source or during production, MOFID SECURITIES COMPANY accepts no liability whatsoever for any loss or damage resulting from errors, inaccuracies or omissions affecting any part of the publication. All information is provided without warranty, and MOFID SECURITIES COMPANY makes no representation of warranty of any kind as to the accuracy or completeness of any information hereto contained.

This publication does not provide individually tailored investment advice and may not match the financial circumstances of some of its recipients. The securities discussed in this publication may not be suitable for all investors. The value of an investment can go down as well as up. Past performance is no guarantee of future success.

 

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