Iranian Rial Falls Below 2.2 Million to the Dollar, Setting New Low

The dollar in Tehran's free market has surpassed 2.2 million Iranian rials, equivalent to 220,000 tomans, setting a record for open trading; two days ago it was about 2.1 million tomans, and the record on August 25 was 2.02 million rials.

At the beginning of the Iranian calendar year in March, the dollar was about 1.35 million rials, depreciating by about 60% since then; the Guardian reports it has roughly halved in a year. The euro is about 2.55 million rials, the pound about 2.97 million, and the UAE dirham has first reached 600,000 rials. The market and official commercial exchange rates differ by about 38%, with the official rate at about 1.59 million. Imam gold coins are about 226 million tomans. The implied exchange rate of crypto USDT is close to the market rate.

Central Bank Governor Abdolnaser Hemmati stated that reserves are sufficient and not frozen, and they are prepared to inject up to $2 billion into the exchange market to curb volatility, having already injected $500 million last week; since March, they have provided over $18 billion in foreign exchange for food, medicine, feed, and raw material imports. He attributed the latest drop more to psychological factors and refuted the U.S. claim of "no reserves." The market continued to hit new lows after the statement. U.S. Treasury Secretary Janet Yellen announced on August 24 the "Economic Exile Action," expanding secondary sanctions on nearly 60 Iranian-related individuals, entities, and vessels, covering digital assets, gold, aviation, and shipping.

After the ceasefire broke down in July, the U.S. resumed maritime blockades of ports. Reuters cited industry data: in August, Iran's crude oil shipments were about 220,000 to 255,000 barrels per day, down from about 2 million barrels in March. Before the war and sanctions, there was already double-digit inflation and negative growth; July year-on-year inflation was about 66%, with food inflation previously reported in triple digits, as imported goods like cooking oil, poultry, and tomatoes saw price increases with the exchange rate adjustment.

Who is buying and who is selling: The events are driven by war, blockades, and secondary sanctions cutting off oil foreign exchange, not just daily verbal interventions by the central bank. Residents and businesses are buying dollars, euros, gold coins, and stablecoins to preserve value; the central bank is selling limited dollars in an attempt to anchor expectations. Beneficiaries are currency exchange merchants who can access Dubai and crypto channels, while those under pressure are food and medicine channels that import at official rates and replenish at market prices. The $2 billion corresponds to a market for about 90 million people, only sufficient for brief price inquiries, unable to change the shipping volume from 2 million barrels to about 255,000 barrels due to supply constraints.

Source: Public Information