Iran’s rial drops to record low

DUBAI: The Iranian rial fell to its lowest ever rate against the US dollar on the unofficial market on Saturday, a day after Tehran’s rebuke by the UN nuclear watchdog increased the pressure from US sanctions and the coronavirus outbreak.

The dollar was offered for as much as 193,300 rials, up from 188,200 rials on Friday, according to foreign exchange site Bonbast.com, which tracks the unofficial market. The economic daily Donya-eEqtesad gave the dollar rate as 190,800.

The International Atomic Energy Agency’s 35nation Board of Governors called on Iran on Friday to stop denying it access to two suspected former nuclear sites, raising diplomatic pressure on Tehran.

President Donald Trump withdrew the US from a multilateral deal aimed at curbing Iran’s nuclear program in May 2018 and reimposed sanctions that have battered the economy. A drop in oil prices and a slump in the global economy have deepened the economic crisis in the country, one of worst-hit by the coronavirus pandemic in the Middle East.

Central Bank chief Abdolnaser Hemmati said the psychological impact of the IAEA resolution on the rial was exaggerated and that Iran’s economy could cope with the added pressure. “The circumstances created by corona, the temporary pressure on the foreign exchange market ...and the psychological atmosphere caused by the resolution of the IAEA Board of Governors should not give the wrong signal,” Hemmati said in an Instagram posting.

“Despite the limited oil revenues, the country’s foreign exchange balance is good and the central bank will continue to provide the needed currency... despite continued US pressure,” he added. The rial lost about 70 percent of its value over several months to fall to 190,000 in September 2018 amid heavy demand for US dollars among Iranians who feared Washington’s withdrawal from the nuclear deal and sanctions could shrink vital oil exports and severely impact the economy.