Why Iran's Rial Hit an All-Time-Low Against the US Dollar

Today $1 costs 100 thousand Iranian rials, that is an all-time-low rate against dollar. Although several reasons for the slide have been put forward by economists – amongst them the strength of the dollar against other currencies in the last few weeks, and the uncertainty before Iran’s presidential elections next year – many suggest the main reason is the election of Donald Trump in November.

“Amongst external factors, there is the rise of interest rate in the United States which has added to the value of the dollar in global markets including in Iran,” explains euronews journalist Hossein Alavi. “The other factor is the election of Donald Trump as the future US president which has cast doubts over the nuclear deal with Iran. As far as the internal factors are concerned, there has been an increase in demand for dollars from people travelling and traders .”

In the last 10 years, Iran has seen the value of the rial drop from 9,200 to $1 to 41,600 to $1, a depreciation of some 450 percent. Much of that collapse came in 2012 over the country’s contested nuclear program, when the U.S. banned the world’s banks from taking part in Iran’s oil economy and the European Union imposed an oil embargo.

Under the 2015 nuclear deal between Iran and world powers, international sanctions against the country were lifted in exchange for it limiting its enrichment of uranium. Since then, Iran has rushed to increase oil production to regain its lost market share while simultaneously signing deals worth tens of billions of dollars with airplane manufacturers Airbus and Boeing Co.

But the rial, initially buoyed by the accord, has now fallen. The official unemployment rate has risen to 12.7 percent this year from 10.6 percent in 2014, while youth unemployment has reached 27 percent.

Despite this situation, experts suggest certain industries are poised to benefit from the current market dynamics as the depreciation of the rial will make Iranian exports more attractive to the world market.

1665 views


More Iran News

Zarif: Trump to be surprised if ditches Iran nuclear deal

Zarif: Trump to be surprised if ditches Iran nuclear deal

Foreign Minister Mohammad Javad Zarif says Iran will have its “own options” in response to any violations of the 2015 nuclear deal, adding that the Islamic Republic will “surprise” US …

Tehran tragedy: number of killed in high-rise collapse unknown (VIDEO)

Tehran tragedy: number of killed in high-rise collapse unknown (VIDEO)

Видео

Iranian rescuers voiced the number of victims of the high-rise building in Tehran, collapsed due to the fire. According to rescuers, at least 75 people, including 45 firefighters, who had been called in to battle the blaze, have …

Iranian female bodybuilder arrested for posting un-Islamic selfies - media

Iranian female bodybuilder arrested for posting un-Islamic selfies - media

An female Iranian bodybuilder has been arrested after publishing selfie of her muscles on social media which were deemed to be 'nude', Daily Mail reports. The woman, who is accused of breaking the Islamic Republic's strict …

Dozens of firefighters killed after collapse of high rise building in Tehran

Dozens of firefighters killed after collapse of high rise building in Tehran

Rescue teams were searching for at least 25 trapped firefighters after a blazing high-rise building collapsed in Tehran, the city's mayor said. State TV reported that at least 75 people, including 45 firefighters, had been hurt when …

Iranian delegation to Astana to be headed by country#039s Deputy Foreign Minister

Iranian delegation to Astana to be headed by country's Deputy Foreign Minister

The Iranian delegation at the Syrian talks in Astana will be headed by the Iranian Deputy Foreign Minister, Hossein Jaberi Ansari, the Iranian Foreign ministry said. Tehran believes the forthcoming …

Iran’s Zarif, EU’s Mogherini discuss JCPOA, Syria in Davos

Iran’s Zarif, EU’s Mogherini discuss JCPOA, Syria in Davos

Iranian Foreign Minister Mohammad Javad Zarif and European Union Foreign Policy Chief Federica Mogherini Wednesday held talks on various issues, including the 2015 nuclear deal between Tehran and world powers, …

Zarif: Iran can cooperate with Saudi

Zarif: Iran can cooperate with Saudi

Iran and Saudi Arabia should be able to work together to help end conflicts in Syria and Yemen, after successfully cooperating over Lebanon last year, Iranian Foreign Minister Mohammad Javad Zarif said at the World …

OPEC decreased its oil output

OPEC decreased its oil output

OPEC has decreased its oil production by 221,000 barrels per day in December 2016 down to 33.08 million barrels amid the deal on oil output curtailment, the cartel said in its monthly report. The largest decline in crude oil production …

Iran’s Zarif to address Davos forum

Iran’s Zarif to address Davos forum

Iranian Foreign Minister Mohammad Javad Zarif arrived in Switzerland to take part in the annual meeting of the World Economic Forum underway in Davos. Heading a high-ranking delegation, Zarif arrived in Davos to address …

Barack Obama warns Donald Trump not to abandon Iran nuclear deal

Barack Obama warns Donald Trump not to abandon Iran nuclear deal

A year ago most international sanctions against Iran were lifted

more Iran News