Iran’s free-market dollar rate rose above 2.5 million rials on Tuesday, extending a sharp fall in the currency and adding to concerns about rising prices and shrinking household purchasing power.
The dollar had set a record of 2.418 million rials a day earlier, on September 28. It gained more than 80,000 rials – over 3% – in less than 24 hours.
Other foreign currencies also rose. The euro reached 2.77 million rials and the British pound 3.23 million rials.
The currency slide is intensifying pressure on households already facing higher costs for food, housing and healthcare. A weaker rial raises the cost of importing raw materials, medicines, medical equipment and consumer goods, potentially pushing up prices across the domestic market.
Messages from workers, pensioners and other salaried people sent to Iran International in recent weeks reflected widespread concern over falling incomes. Some said their monthly earnings no longer covered essential expenses and daily price increases had made it difficult to plan ordinary household purchases.
The currency market is volatile amid rising inflation, falling production, trade restrictions, foreign-currency shortages and difficulties transferring money. Exchange-rate swings are also increasing the cost of raw materials for manufacturers and contributing to price instability.
The United States has stepped up pressure on Iran’s financial resources in recent weeks, including through a naval blockade, efforts to prevent oil sales and restrictions on the transfer of oil revenue.
Iranian authorities have also targeted people they accuse of disrupting the currency and gold markets. On Monday, the Financial Intelligence Center of the Economy Ministry said it had suspended banking services for 45 people over alleged activity in unofficial currency and gold markets and “suspicious transactions.”
The addition brings to 214 the number of people placed under similar banking restrictions, the center said. It has not published their names or evidence of their alleged role in driving up currency and gold prices.