Tue Feb 18th, 2025

Iran's economy in free fall: Rial hits new record low

December 28th 2024 , ,
View of Tehran Photo: Frank Furness via Pixabay

Iran's economy is in free fall as its currency plummets to a new record low against the dollar on Saturday, amid a severe energy crisis, tensions in the Middle East and the return of Donald Trump to the US presidency.

The Iranian currency was quoted at 810.000 rials per dollar, its lowest value in history on the free market, according to the country's media and prices confirmed by exchange houses in Tehran to EFE.

The rial has thus lost more than 30% of its value in almost three months for various reasons, including Donald Trump's victory in the US presidential election last November, amid fears that he would once again apply the policy of maximum pressure against Tehran.

During his first term (2017-2021), Trump abandoned the nuclear agreement signed in 2015 with six major powers that limited activities related to Iran's nuclear program and reimposed economic sanctions against the Persian country.

In addition to potential economic pressures, Iran is also facing an energy crisis due to a gas shortage in the middle of winter, despite the fact that Iran has the second largest gas reserves in the world.

This crisis has forced the closure of schools, offices, banks and universities in recent weeks and power cuts across the country.

Another factor is developments in the Middle East, especially the fall of deposed Syrian President Bashar al-Assad, an ally of Iran, on December 8, and tensions between Iran and Israel that have dealt severe blows to terrorist organizations allied to Tehran, such as the Palestinian Hamas and Lebanon's Hezbollah, and the current Israeli confrontation with Yemen's Houthis, who make up the self-proclaimed "Axis of Resistance" alliance against the Jewish state.

These conditions were also outlined by Iran's Economy Minister Abdolnaser Hemmati at a meeting with the parliament's economic committee last Monday, and he considered this devaluation of the Iranian rial to be normal.

“Under normal political and economic circumstances, the rial should be trading at around 730.000 per dollar,” he said, stressing that with inflation above 30 percent, “it is impossible to keep the exchange rate stable.”

According to Iran's Statistical Center, the country recorded an annual inflation of 32% last month compared to the same period in 2023. EFE and Aurora

2 thoughts on “Iranian economy in free fall: rial hits new record low”
  1. A small blow to the economy before Trump takes office
    One of those that everyone knows was Israel but Israel does not admit it. More psychological than real and the dollar soars.

  2. Ideally, Israel would seize the moment to attack the tyrannical regime's sources of income. I am almost certain that the people would rise up against the murderous, corrupt and tyrannical ayatollahs and free themselves from them.

Leave a comment

Your email address will not be published. Required fields are marked with *

This site uses Akismet to reduce spam. Learn how your comment data is processed.