Iran’s national currency fell to its weakest point in history on Monday, sliding close to 1,250,000 rials per U.S. dollar on the open market, according to multiple local reports including the semi-official Tasnim news agency. The sharp decline marks one of the steepest drops since U.S. sanctions were reinstated in 2018, when the rial traded near 55,000 to the dollar.
The collapse reflects growing pressure on Iran’s financial system as renewed sanctions continue to restrict the country’s access to foreign currency and limit its oil revenues. Economic analysts inside Iran are attributing part of the recent depreciation to the government’s latest round of market-liberalization measures.
Under Tehran’s dual-rate system, businesses typically rely on state-controlled exchange rates, while everyday citizens purchase foreign currency on the open market. However, a new policy allowing importers to use the open market to buy dollars for essential goods has dramatically increased demand, pushing prices higher. The semi-official Fars news agency reported that this shift has intensified volatility on the street exchange market.
Iran’s broader economic outlook is also deteriorating. The World Bank forecasts the country will slide into recession, projecting a 1.7% contraction in 2025 followed by a 2.8% decline in 2026. Inflation continues to surge as well, with Iran’s Statistical Centre reporting 48.6% monthly inflation in October, the highest level in more than three years.
Despite the mounting pressure on households, the government announced plans to raise fuel prices starting in December for drivers who consume more than 100 liters per month. Economists warn that the move could further fuel inflation and deepen financial hardship for millions of Iranians.
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