Iranian rial plummets to record low

Amid increasing tensions between Iran and Israel, the Iranian rial has fallen to an unprecedented low, now valued at less than 1/10,000th of its worth before the Islamic Republic's establishment.

The US dollar exchange rate surged to over 705,000 rials in Iran's free market on Sunday. One dollar was traded at about 70 rials on average for several years before the Islamic Revolution of 1979, News.Az reports, citing Iranian media.

The rial dropped to 762,000 against the euro and 905,000 against the British pound.

On Sunday, the Tehran Stock Exchange index also plunged by 28,000 points, falling to about 2,032,000 points.

Iran is already grappling with soaring inflation exceeding 40%, and the rial's continued decline will drive prices even higher, further impoverishing a population that has seen its purchasing power fall significantly since 2018. That year, US sanctions imposed by the Trump administration—following its withdrawal from the 2015 nuclear deal—targeted oil exports and banking, slashing Iran’s income and dealing a severe blow to its oil-dependent economy.

On top of mounting military and economic pressures, President Masoud Pezeshkian unveiled next year’s budget in October, allocating nearly 20% of Iran’s oil export revenue—estimated to exceed $10 billion—primarily to the Revolutionary Guard. In the current budget, the military’s share of oil is around 200,000 barrels per day, while next year it would be an estimated 430,000 barrels.

News.Az