Iran is facing a new economic crisis as pressure from Western nations and unrest within the country continues to mount. The country’s currency, the Iranian rial, has reached an all-time record low, with the US dollar going past 450,000 rials for the first time.
In response to this, the Central Bank of Iran has announced that it will soon raise the maximum amount of currency that can be sold annually from $2,000 to $5,500. This move is an effort to show that Iran has no shortage of currency, despite the recent devaluation of the rial.
The devaluation of the rial has led to rising prices, inflation and currency devaluation, which have been identified as priorities for this year’s budget by President Hassan Rouhani. He has tried to reassure Iranians over the economy, as the country faces a crisis due to already imposed US sanctions on Iran’s exports.
The inflation rate in Iran has reached 45 percent at the end of December, and the government has implemented a short-term plan to support actively in the sectors of housing, health, food and transport. The parliament has approved the budget, which includes exports of 1.4 million barrels of crude oil per day at an average price of $85 per barrel.
The situation of currency and gold, as well as high costs in the country, will decrease according to the government. However, actions imposed by Western nations have also been troublesome for Iran’s economy. The first set of sanctions imposed are against the government’s response to protests which were sparked after the death of Masa mini. The second set is over Iran’s alleged involvement in the Russia-Ukraine War.
According to reports, Iranian aviation firm Shahid is providing Nashirama drones that are then used against Ukraine. Iran has repeatedly denied the supply of weapons, but later admitted to sending drones to Russia before the invasion began in February last year.
Overall, the economic crisis in Iran continues to worsen as the country faces pressure from Western nations and internal unrest. The devaluation of the rial and rising prices have led to a decrease in the standard of living for many Iranians, and it remains to be seen how the government will address these issues in the coming months.