Iranian Rial Plunges to Record Low Amid US Sanctions Plan

Iran's currency dropped to a record low of over two million rials per US dollar on the open market as the United States plans new sanctions. The currency decline coincides with a severe economic crisis and high inflation.

Key points

• The open market exchange rate values the rial significantly lower than the official rate.
• The International Monetary Fund expects the Iranian economy to contract by more than five percent this year.
• Food inflation in Iran currently exceeds 100 percent alongside rising unemployment.
• The US Treasury's planned sanctions aim to increase economic pressure on Tehran.

Why it matters

The dramatic depreciation of the rial severely impacts the purchasing power of Iranian households and exacerbates the country's ongoing economic contraction and high inflation.