Iran rial drops to record low
Iran’s currency has dropped to a record low ahead of the imposition of renewed American sanctions, with many fearing prolonged economic suffering or possible civil unrest.
The rial dropped to 122,000 to the dollar on the thriving black market exchange Monday, from the previous low set the day before of 116,000.
Already last month, protesters clashed with police outside parliament in Tehran amid three days of demonstrations sparked by the currency’s plunge, and worries are growing about what might happen once the new sanctions kick in Aug 6.
The central bank on Monday blamed the currency’s free fall on “the enemies’ conspiracies.”
President Donald Trump’s administration announced the restoration of sanctions after he withdrew the US from the Iran nuclear deal in May.
In May the United States pulled out of a 2015 deal between world powers and Tehran under which international sanctions on Iran were lifted in return for curbs on its nuclear programme.
Washington decided to reimpose sanctions on Iran upon its withdrawal, accusing it of posing a security threat, and has told countries they must halt all imports of Iranian oil from Nov 4 or face US financial measures.
The rial has lost about half of its value since April because of a weak economy, financial difficulties at local banks and heavy demand for dollars among Iranians who fear the effects of sanctions.
Trump has called the agreement one of the worst deals ever negotiated but in a bid to salvage the accord, Iran’s European partners in the nuclear deal are preparing a package of economic measures to offset the US pullout.
However, France said earlier this month that it was unlikely European powers would be able to put together an economic package for Iran that would salvage its nuclear deal before November. (Agencies)