Iran’s currency hits record low
Iran’s currency dropped to its lowest value in history on December 8th, according to a report by The New Arab via different outlets such as the semi-official Tasnim news agency.
The Iranian Rial was listed at 1,250,000 to the US dollar on the open market, compared to 55,000 in 2018.
The Iranian press blamed the government’s recent attempts to deregulate the economy, stating the policies had increased stress on the open rate market.
The open rate market allows the country’s population to acquire foreign currency, while businesses normally use state-controlled rates.
Semi-official, Fars news agency, claimed that government policy permitting importers to invest in the open market and import essential goods had pressured the markets and heightened the dollar’s price.
In September and October, multiple sanctions were placed on Iran by the European Union (EU) and The United Nations(UN) due to its “continued non-compliance with the nuclear agreement.”
The EU’s sanctions included the freezing of the countries central bank as well as other major Iranian banks.
Iran’s transport and purchasing of crude oil was also banned, alongside the sale or supply of gold and some naval equipment.
The World Bank has projected economic deflation of 1.7 percent in 2025 and 2.8 percent in 2026, with the country now facing a possible recession.
Inflation is an additional concern, with the value of the currency rising by a third in the last four months. Iran’s Statistical Centre declared monthly inflation at 48.6 percent in October, the highest rate since August 2022.
Despite these issues, the Iranian government announced in October it would raise the cost of fuel in December in certain circumstances. This would mostly affect drivers using above 100 litres per month.
According to a report from FXStreet via AP, gold is now the most reliable investment for Iranians, amid the decline of the Rial. A gold and jewellery vendor told AP that the demand for gold had never been higher, with the population viewing it as the best way to preserve value.
FXStreet via AP, Maghrebi.org, The New Arab via Fars news agency and Tasnim news agency
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