Iran currency plunges to record lows amid escalating US tensions

Facing an official inflation rate of about 35%, Iranians seeking safe havens for their savings have been buying dollars, other hard currencies, gold or cryptocurrencies, suggesting further headwinds for the rial.

By The Algemeiner and Reuters

Iran’s currency fell on Saturday to a new all-time low against the US dollar after the country’s supreme leader rejected talks with the United States and President Donald Trump moved to restore his “maximum pressure” campaign on Tehran.

The rial plunged to 892,500 to the dollar on the unofficial market on Saturday, compared with 869,500 rials on Friday, according to the foreign exchange website alanchand.com.

The bazar360.com website said the dollar was sold for 883,100 rials. Asr-e-no website reported the dollar trading at 891,000 rials.

Facing an official inflation rate of about 35%, Iranians seeking safe havens for their savings have been buying dollars, other hard currencies, gold or cryptocurrencies, suggesting further headwinds for the rial.

The dollar has been gaining against the rial since trading around 690,000 rials at the time of Trump’s re-election in November amid concerns that Trump would re-impose his “maximum pressure” policy against Iran with tougher sanctions and empower Israel to strike Iranian nuclear sites.

Trump in 2018 withdrew from a nuclear deal struck by his predecessor Barack Obama in 2015 and re-imposed U.S. economic sanctions on Iran that had been relaxed.

The deal had limited Iran’s ability to enrich uranium, a process that can yield fissile material for nuclear weapons.

Iran’s rial has lost more than 90% of its value since the sanctions were reimposed in 2018.