Iranian currency slides to new record lows as US sanctions, pandemic weigh

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Iranian currency slides to new record lows as US sanctions, pandemic weigh

As the Iranian economy had been facing off a double whammy regarding the US sanctions alongside the ongoing pandemic outbreak, on the unofficial trading on Saturday, the Iranian Rial fell to a new record lows against its American counterpart.

Besides, according to an Iranian economic daily newspaper Donya-e-Eqtesad, the US Dollar/ Iranian Rial pair was traded on Saturday at 215,250 rials, over 3 per cent up from the Friday’s closing price of 207,500 Iranian Rial per US Dollar, while a FX trading site that offers live exchange rates in Iran’s free market had told that the buyers were offering as much as 215,500 rials per US Dollar.

However, during preparation of the report, early morning Asia-Pacific trading hours, the aforementioned site was offering an exchange rate of 222,500 Iranian rial per US Dollar. In point of fact, the reason behind the freefall of Iranian Rial was rooted back in the May of 2018 when the US President Donald Trump had withdrawn the United States from a multilateral deal signed off on 2015 in order to curb out the Mideast oil-rich nation’s nuclear program.

Since then, the Trump Administration had been inclining a number of sanctions on Tehran in order to diminish the Gulf super power’s regional influence, eventually leading to a Dollar-buying spree. However, latest leg of decline in the Iranian currency was mostly catalysed by a historic plunge in the crude oil prices alongside a deepening economic crisis in the country due to the pandemic outbreak.

Rial’s decline continue despite assurance from Iranian Central Bank

Meanwhile, as the Iranian Rial has been experiencing a persistent plunge in valuation, last week the Iranian Central Bank Governor Abdolnaser Hemmati was quoted saying that the Central Bank had injected hundreds of millions of Dollars in order to stabilize the currency market, however, the Central Bank’s comment appeared to have little effect on a Dollar-buying bonanza following a lawsuit filed by the Iranian Government against the US President Donald Trump over accusation of organizing the murder of the Iranian Revolutionary Guard Chief Qassem Suleimani in the Baghdad International Airport, suggesting a drawdown of the Iranian Rial has been far from being bottomed.