Iranian Rial plunges to new record low of 501,300 against dollar
Business
Iranians have been purchasing dollars, other hard currencies, gold to protect savings from inflation
TEHRAN (Reuters) - The ailing Rial fell below the psychologically significant milestone of 500,000 to the dollar on Monday as traders anticipated no relief from the sanctions. The Iranian Rial plunged to a new record low of 501,300 versus the US dollar, according to Bonbast.com which collects real-time statistics from Iranian markets.
Iranians have been purchasing dollars, other hard currencies or gold in order to protect their savings from the country's around 50% inflation rate which suggests that the Rial will continue to face difficulties in the future.
By restricting Tehran's access to foreign cash and oil exports former President Donald J. Trump's imposed of US sanctions in 2018 hurt Iran's economy.
Iranian economic prospects have been worse since September when negotiations between Iran and foreign powers to limit Tehran's nuclear program in exchange for the easing of sanctions broke down. Iran's currency has lost approximately 60% of its value during the past six months, according to Bonbast.com.
To improve the amount of official transactions and to make foreign exchange easier to get, the central bank announced the creation of a new foreign exchange center.
"The currency rate decided upon here will be the market rate. It should not contain any expectation variables that do not align with how we view the nation's financial position "The governor of the central bank, Mohammad Reza Farzin, said on Monday on state television.
