Iranian Rial Hits Historic Low as Dollar Surpasses 2 Million Rials

TEHRAN: The Iranian rial has fallen to a historic low, with the value of the US dollar surpassing 2 million Iranian rials in the open market amid continued pressure on Iran’s currency.

According to Iranian media reports, the rial has continued to lose value rapidly against major foreign currencies. The US dollar was trading at around 1.865 million rials at the beginning of last week, meaning its value increased by more than 7% in less than a week.

Compared with the same period last year, the dollar has almost doubled in value against the Iranian rial, when it was trading at around 958,000 rials.

Earlier on Sunday, the dollar was reportedly being traded at approximately 1.98 million rials in Iran’s open market, while the British pound was quoted at around 2.70 million rials and the euro at approximately 2.31 million rials.

The sharp decline has raised concerns among traders and investors, particularly those involved in cross-border trade between Pakistan and Iran.

A few weeks ago, some Pakistani investors reportedly purchased around 300 billion Iranian rials amid positive signals surrounding peace talks between the United States and Iran and expectations that the reopening of the Strait of Hormuz could help normalize global trade activity.

Around two months ago, Rs4,500 to Rs5,000 was reportedly being charged in Pakistan’s open market for 10 million Iranian rials, prompting a number of Pakistanis to invest in the Iranian currency.

Currency market experts and dealers had previously warned traders engaged in Pakistan-Iran trade that the significant gap between official and unofficial exchange rates could lead to sharp fluctuations in the value of the Iranian rial.

The latest depreciation has further increased uncertainty for businesses and investors holding the Iranian currency.