Iranian currency drops after presidential vote and no deal with US
The Iranian rial has hit new lows since the election of Ebrahim Raisi, a hard-line president, in a controversial vote that prevented his main rivals from contesting the vote on June 18.
The rial was trading above 250,000 to the US dollar on Wednesday on Tehran’s unofficial foreign exchange market. The fate of the currency is linked to the chances of an agreement with the United States on the lifting of crippling sanctions imposed by former President Donald Trump when he withdrew the 2015 nuclear deal in 2018.
President Joe Biden’s administration wants to reverse the deal and has started indirect talks with Iran in Vienna since April. As talks were due to begin, the rial rose 20% in April, approaching 200,000 to the US dollar, but as negotiations dragged on and the presidential election approached, the currency began to lose again. value.
Before the establishment of the Islamic Republic in 1979, the dollar was 72 rials and in 42 years it had multiplied by 3,500. But the fastest decline occurred in 2018, when Trump imposed sanctions and cut Iran’s oil exports a lifeline for its government, which has resorted to printing money and inflation. Prices are rising by 50% per year, impoverishing millions of Iranians.
Labor strikes that started last week among oil and refinery workers threaten to spread to other sectors and put more pressure on the government. Many workers have not been paid for months.