Iran’s currency, the rial, has continued to lose value against the US dollar, reaching a new record low in the open market.
According to market sources, one US dollar was being traded for around 2.688 million Iranian rials, compared with 2.632 million rials a day earlier.
The dollar reportedly climbed as high as 2.695 million rials during trading. The sharp decline in the rial has added to the economic pressure already facing Iran.
The currency has lost more than half of its value over the past year, while rising inflation, US sanctions, pressure on oil exports and foreign currency shortages have increased uncertainty in the market.
Reports indicate that Iran’s inflation rate has surpassed 70 per cent, increasing the cost of everyday goods, housing and other basic necessities for citizens.
In an effort to support the rial, the Central Bank of Iran has announced plans to inject up to $2 billion into the currency market.
State-owned banks have also begun selling dollars to meet demand for foreign currency and ease pressure on the rial.
However, the currency continued to weaken despite the measures. Mehdi Darabi, an adviser on foreign exchange affairs at the central bank, said negative forecasts by US officials about Iran’s economy and reports from abroad were also contributing to uncertainty in the market.
As the rial continues to weaken, many Iranians are turning to the US dollar, other major currencies and gold to protect their savings.
Economists warn that a weaker rial could make imported goods and raw materials more expensive, further fueling inflation and putting additional pressure on consumers’ purchasing power.
The dollar had already crossed the 2.5 million-rial mark on September 29. On September 2, the exchange rate had reached around 2.2 million rials per dollar, which was then considered a record low for the Iranian currency.
Read also: Iranian rial hits record low as dollar price surges
