Iranian currency falls to record low amid isolation and sanctions

DUBAI, Jan 21 (Reuters) – Iran’s troubled currency fell
to a record low against the U.S. dollar on Saturday amid the
country’s increasing isolation and possible Europe Union
sanctions against Tehran’s Revolutionary Guards or some of its
members.

Ties between the EU and Tehran have deteriorated in recent
months as efforts to revive nuclear talks have stalled. Iran has
detained several European nationals and the bloc has become
increasingly critical of the violent treatment of protesters and
the use of executions.

The EU is discussing a fourth round of sanctions against
Iran and diplomatic sources have said members of the
Revolutionary Guards will be added to the bloc’s sanctions list
next week. But some EU member states want to go further and
classify the Guards as a whole as a terrorist organisation.

The dollar was selling for as much as 447,000 rials on
Iran’s unofficial market on Saturday, compared with 430,500 the
previous day, according to the foreign exchange site
Bonbast.com.

The rial has lost 29% of its value since nationwide protests
following the death in police custody of a 22-year-old Kurdish
Iranian woman, Mahsa Amini, on Sept. 16.

The unrest has posed one of the biggest challenges to
theocratic rule in Iran since the 1979 Islamic Revolution.

The economic Ecoiran website blamed the continued fall of
the rial on an apparent “global consensus” against Iran.

“Increasing political pressures, such as placing the
Revolutionary Guards on a list of terrorist organisations, and
imposing restrictions on Iran-linked ships and oil tankers…
are factors pointing to a global consensus against Iran, (which
may affect) the dollar’s rate in Tehran,” Ecoiran said.

The European Parliament called on Wednesday for the EU to
list Iran’s Guards as a terrorist group, blaming the powerful
force for the repression of protesters and the supply of drones
to Russia. The assembly cannot compel the EU to add the force to
its list, but the text was a clear political message to Tehran.

Panama’s vessel registry, the world’s largest, has withdrawn
its flag from 136 ships linked to Iran’s state oil company in
the last four years, the country’s maritime authority said this
week.

Iran’s central bank governor Mohammad Reza Farzin on
Saturday blamed the fall of the rial on “psychological
operations” which Tehran says its enemies are organising to
destabilise the Islamic Republic.

“Today, the central bank faces no restrictions in terms of
foreign currency and gold resources and reserves, and media
deceit and psychological operations are the main factors behind
the fluctuation in the free exchange rate,” state broadcaster
IRIB cited Farzin as saying.

Facing an inflation rate of about 50%, Iranians seeking safe
havens for their savings have been trying to buy dollars, other
hard currencies or gold.

(Reporting by Dubai newsroom)