“You can’t apply 25 basis points (bps) to a bottleneck. It’s the Hormuz risk premium, and we defined it,” he wrote
The speaker of Iran’s Parliament, Mohammad Bagher Ghalibaf, stated on Wednesday that increases in the United States’ interest rates will not be able to curb inflation, linking price pressures to blockades in the Strait of Hormuz.
On X, Ghalibaf declared that the Federal Reserve (the U.S. central bank) cannot control inflation expectations merely by adjusting interest rates. He argued that the real driver of price pressures is a supply-side shock linked to the closure of strategic energy corridors.
“You can’t apply 25 basis points (bps) to a bottleneck. It’s the Hormuz risk premium, and we defined it,” he wrote.
The post was made before the Fed’s monetary policy decision, which raised rates to the 3.75% to 4% per year range.
In parallel, the secretary of Iran’s Supreme National Security Council, Major General Mohsen Rezai, said on Wednesday that the country has “absolutely no trust in the United States” and that Washington must take concrete steps to win “our trust.”
Rezai’s remarks were made at a meeting with the president of the Patriotic Union of Kurdistan in Iraq, Bafel Talabani.
James Whitmore