Dissolve ground saffron in 2 tablespoons of boiling water and set aside (click for How to Use Saffron).
Heat the oil in a pot over medium heat. Add onion and saute for 5 minutes. Add garlic and saute for 1 minute or until fragrant. Increase the heat to medium-high; add chicken and saute until no longer pink. Add the turmeric powder and stir gently. Then add the bay leaf, water, salt and pepper.
Cover the pot and bring to a boil. Reduce heat to medium-low and cook covered for 20 minutes.
Add the dissolved saffron and cinnamon, and cook covered until chicken is cooked through, stirring occasionally. Discard the bay leaf. Taste for salt and add more if needed.