Iran to convert €45 billion into U.S. dollars, gold ingots

Tehran - The Central Bank of Iran announced that it will change its monetary policy by converting €45 billion into United States dollars, it's most powerful enemy, and gold ingots. This plan is to be carried out into three separate phases.

According to CNBC, one-ounce of gold is trading at more than $1,200USD and the U.S. dollar index is trading at 86.4 points. The euro is heading towards a downward spiral due to the debt crisis hitting the Eurozone. On Wednesday, the Central Bank of Iran (CBI) disclosed its new monetary policy, which will see the country sell €45 billion and convert it into U.S. dollars and gold bullion ingots, reports the Wall Street Journal. Sources close to the situation have stated that CBI will take gradual steps and the monetary measures will be initialized in three separate steps during the next four months, reports Press TV. One of the first steps has already been implemented. Simon Derrick, a senior currencies analyst at the Bank of New York Mellon in London, said it’s interesting that Iran is prepared to buy U.S. dollars because they continually talk about measuring the price of oil in euros. “I think it's significant. Iran spends a lot of time talking about pricing oil in euros, and now it appears to be deciding to find alternative stores of value." Reuters reports that Iran’s decision would reduce the portion of the country’s reserves of euros to between 20 and 25 per cent from 55 per cent. Iran’s recent policy change is a dramatic shift from years of banning the U.S. dollar. Nations in the Persian Gulf are also taking similar steps as Iran by converting their euro reserves into dollars and gold ingots.