On Sunday, Iran’s national currency, the rial, recorded the lowest-ever rate against the US dollar as the country’s open market recorded its lowest-ever rate against the US dollar in months-long protests.
On Sunday, the weak rial traded above 411,000 to the greenback on the bonbast foreign exchange website as the US dollar and other foreign currencies fiercely rallied against it.
The rial breaching the 400,000 threshold for the first time in the country’s history has caused concerns in the foreign exchange market and financial circles.
Market analysts say Iran’s currency has lost about 20% of its value since mid-September when countrywide protests erupted after an the death of Mahsa Amini in police custody which has sparked further sanctions.
Ali Salehabadi, the Central Bank Governor, cited the ongoing protests as one of several destabilizing factors contributing to the forex market turmoil last week.
However, the summons of Salehabadi and Iran’s finance minister and government spokesman Ehsan Khandozi by the country’s parliament on Sunday did not work.
Admitting that the forex market has suffered from instability, Khandozi told parliamentarians that the central bank was considering steps to correct the situation, blaming ‘enemies’ for concentrating on banks and the forex market after ‘failing to close them down,’ in reference to recent nationwide strikes.
Despite Parliament Speaker Baqer Ghalibaf’s sharp rebuke of the central bank, saying the forex situation was “unacceptable to people,” the central bank said it was investigating the issue.
Germany announced Friday that it was downgrading relations with Iran and halting trade promotion programs, because of the “very serious situation” there.
The Iranian currency’s depreciation has occurred at a time when talks in Vienna about saving the 2015 nuclear deal are taking place and reports are emerging about Iran supplying drones to Russia for use in the Ukraine conflict.
Image Credit: Ashkan Forouzani on Unsplash
